EU COMMUNICATIONS: Telecom Italia Received Binding Offer For Sparkle Unit
TITIM Ba3[P]/BB/BB
- Italy and Asterion Industrial Partners' Retelit offered EUR 700mn for Telecom Italia's Sparkle submarine cable unit, in line with the previous non-binding offer. Offer valid until Jan. 27.
- Corresponds to ~0.2x turns of leverage (excl. any EBITDA impact) which would move leverage from 2.2x towards the YE-target of 2x.
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EQUITIES: EU Cash opening calls
Estox 50: +0.08%, Dax: -0.03%, CAC: +0.19%, FTSE +0.35%, SMI +0.34%,
AUDUSD TECHS: Bears Remain In The Driver’s Seat
- RES 4: 0.6762 High Oct 9
- RES 3: 0.6733 High Oct 13
- RES 2: 0.6642/88 50-day EMA / High Nov 7 and a reversal trigger
- RES 1: 0.6575 20-day EMA
- PRICE: 0.6513 @ 07:54 GMT Nov 19
- SUP 1: 0.6441 Low Nov 14
- SUP 2: 0.6400 Round number support
- SUP 3: 0.6350 Low Aug 5 and a key support
- SUP 4: 0.6339 Low Nov 10 2023
A bear cycle in AUDUSD remains intact and the latest recovery appears corrective. The pair is still trading closer to its recent lows. Support at 0.6513, the Nov 6 low, has been cleared and price is through 0.6490, the 76.4% retracement of the Aug 5 - Sep 30 bull leg. This opens 0.6350, the Aug 5 low and the next key support. Initial firm resistance to watch is 0.6575, the 20-day EMA. The reversal trigger is at 0.6688, the Nov 7 high.
STIR: BoE's Greene Has Cautious Approach To Easing, 66bp Cuts Priced Thru '25
Cues from wider core global FI markets leave SONIA futures flat to +3.0, with a light rally seen early today.
- BoE-dated OIS flat to 1.5bp more dovish through ’25 meetings, pricing ~2bp of cuts for December, 19.5bp of cuts through January, 27bp of cuts through March, 46bp of easing through June and 66bp of cuts through December ’25.
- Little impact from BoE MPC member Greene’s address (which came after Monday’s close).
- Greene pointed to the need for a cautious approach to interest rate cuts, with UK services and wage inflation not coming down as quickly as she would like.
- She underscored expectations that wage growth would continue to ease along with inflation indicators generally moderating, although pointed to inflationary risks surrounding the Budget.
- A reminder that we previously identified Greene as a potential dissenter against the cut delivered at the November meeting, but she voted in line with the majority, supporting the latest leg of easing.
- Her latest comments suggest that she could potentially dissent against further cuts in the future, dependent on the evolution of the data.
- Elsewhere, former BoE official Stephen Millard told us that the Bank’s November forecast for inflation to eventually fall back below target relies on a hard-to-justify assumption of the appearance of an output gap
- Today will see BoE's Bailey, Lombardelli, Mann and Taylor appear at the latest Treasury Select Committee hearing (10:00 London).
BoE Meeting | SONIA BoE-Dated OIS (%) | Current Effective SONIA Rate (bp) |
Dec-24 | 4.678 | -2.2 |
Feb-25 | 4.503 | -19.7 |
Mar-25 | 4.432 | -26.8 |
May-25 | 4.287 | -41.3 |
Jun-25 | 4.237 | -46.3 |
Aug-25 | 4.156 | -54.4 |
Sep-25 | 4.120 | -58.0 |
Nov-25 | 4.063 | -63.7 |
Dec-25 | 4.038 | -66.2 |
