OUTLOOK: Price Signal Summary - Bull Theme In Gilts Remains Intact
Oct-31 12:02
- In the FI space, a short-term bear cycle in Bund futures remains intact. The move down that started on Oct 17 still appears corrective and this has allowed an overbought trend condition to unwind. The next important support to watch lies at the 50-day EMA, currently at 129.12. A clear break would signal scope for a deeper retracement, and open 128.92, the 61.8% retracement of the Sep 25 - Oct 17 bull leg. First resistance is 129.73, Oct 28 high.
- The trend structure in Gilt futures is unchanged, it remains bullish and the contract is holding on to the bulk of its recent gains. Note too that MA studies are in a bull-mode position, highlighting a dominant uptrend. Sights are on 94.00 next. A break of this level would open 94.24, a 1.618 projection of the Sep 3 - 11 - 26 price swing. The contract is overbought, a short-term pullback would allow this condition to unwind. Firm support to watch 92.66, the 20-day EMA.
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GILT PAOF RESULTS: GBP118.525mln of the 1.125% Sep-35 Linker sold.
Oct-01 12:02
- GBP400.0mln had been available.
- This leaves GBP12.776bln of the linker in issue.
EU-RUSSIA: More Leaders Support Ukraine 'Reparations Loan', But Obstacles Remain
Oct-01 11:44
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A growing number of EU leaders are voicing their support for mooted EU plans that could see EUR140bln of frozen Russian assets held in the Union utilised as a zero-interest "reparations loan" for Kyiv. The loan would then only have to be repaid once Russia has, in turn, repaid Ukraine for war damage. European Commission President Ursula von der Leyen said in late September that “We will strengthen our own defence industry by ensuring that part of the loan is used for procurement in Europe and with Europe.”
- In a notable boost for the prospect of the reparations loan, German Chancellor Friedrich Merz backed the idea in an FT op-ed. At today's informal meeting of EU leaders in Copenhagen, a number of EU leaders have backed the idea. Latvian PM Evika Silina said, “We have long called for using frozen Russian assets to aid Ukraine.” Finnish PM Petteri Orpo called the plan "a very good idea", while Estonian PM Kristen Michal said the frozen assets should be utilised "as much as possible". Dutch PM Dick Schoof says the proposal "should seriously be considered, as long as risks are covered".
US TSY FUTURES: BLOCKS: Dec'25 5Y & 10Y
Oct-01 11:41
Both appear to be buys & crossed at same time: 0720:00ET
- +4,800 FVZ5 109-08.25, buy through 109-08 post time offer, DV01 $210,600
- +3,000 TYZ5 112-19, buy through 112-18.5 post time offer, DV01 $203,100
