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EGBS: Bund Futures Strengthen Alongside European Equities; Spreads Tighten

EGBS
BulletEurozoneFixed Income BulletsMarkets

Major EGB futures have strengthened this morning with no obvious catalyst. A renewed fall in natural gas futures (-4% today) will have helped limit retracements over the last 90 minutes, even in the presence of modest 15-year Bund supply. 

  • Bund futures are +24 ticks at 132.72, through the Feb 21 high of 132.60. Recent gains still appear corrective for now, but clearance of key near-term resistance at 132.97 (Feb 13 high) would signal a reversal. Support is seen at the Feb 19 low (131.96).
  • The German curve has bull flattened, with 30-year yields down 2.5bps.
  • Today ‘s 15-year Bund auction passed smoothly.
  • European equity futures are also higher, facilitating a tightening of 10-year EGB spreads to Bunds. The BTP/Bund spread is 1bp narrower at 111.5bps, after mechanically widening on the back of a BBG benchmark BTP roll earlier this week.
  • Regional focus remains on tomorrow’s data calendar. Which includes Spanish flash February inflation.
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Major EGB futures have strengthened this morning with no obvious catalyst. A renewed fall in natural gas futures (-4% today) will have helped limit retracements over the last 90 minutes, even in the presence of modest 15-year Bund supply. 

  • Bund futures are +24 ticks at 132.72, through the Feb 21 high of 132.60. Recent gains still appear corrective for now, but clearance of key near-term resistance at 132.97 (Feb 13 high) would signal a reversal. Support is seen at the Feb 19 low (131.96).
  • The German curve has bull flattened, with 30-year yields down 2.5bps.
  • Today ‘s 15-year Bund auction passed smoothly.
  • European equity futures are also higher, facilitating a tightening of 10-year EGB spreads to Bunds. The BTP/Bund spread is 1bp narrower at 111.5bps, after mechanically widening on the back of a BBG benchmark BTP roll earlier this week.
  • Regional focus remains on tomorrow’s data calendar. Which includes Spanish flash February inflation.