CREDIT PRE-MARKET
- 2y/10y bunds closed +2bp/+5bp at 2.03%/2.09% conceding most of Tuesday’s late gains - DM team flagged that yields rose steadily throughout the session, in an apparent unwinding of Tuesday's Israel-Iran geopolitical risk premium. Solid US private payrolls data weighed on the space in the afternoon with heightened sensitivity ahead of Friday's US nonfarm payrolls report.
- Main/XO ended -0.5bp/-1bp at 59.5bp/316bp while €IG was -1.2bp (Corps -1.5bp, Fins -0.8bp, €HY -3bp) with all IG sectors tighter; Comms/Cyclicals/Energy outperformed at >2bp tighter with Comms the best WoW performer and Energy the worst. $IG was -2bp (Corps -2bp, Fins -1.9bp, $HY flat).
- SXXP/SPX ended flat at 521pts/5710pts. €IG's biggest movers included LANXESS AG (+4%), Aker BP ASA (+4%), Arion Banki HF (+4%), AIA Group Ltd (-1%), Cemex SAB de CV (-5%), Deutsche Lufthansa AG (-4%), Hammerson PLC (-4%), Harley-Davidson Inc (-4%).
- SX5E/SPX futures are -0.5%/-0.2%. The USD has continued to track higher, with weakness in Hong Kong and China related equities weighing on higher beta plays. UST futures are trading in tight ranges today, while bonds have mostly been steady elsewhere. Oil prices have been relatively steady despite lingering Middle East concerns.
- Looking ahead, focus turns to Weekly Claims, Factory/Durable Goods Orders and ISM Services.
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