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CREDIT UPDATE
  • €IG cash is pointing to a flat session, underperformers are little changed from earlier today including Elo (+4-13bps), MS (+1-5) & Reckitt (+2-5bps). iTraxx -0.8/-4 tighter might have got some support today from CDX (-1/-4) & $IG cash - latter pointing to a over 1bp move tighter.
  • We've seen Reckitt come in from wides after management held onto a firm tone dismissing the impact of last week's court loss - we still don't think the curve is attractive given the right tail skew on outcomes & drawn out timing on the bulk Federal/MDL cases. The €590m ABT 27's were only +2bps today.
  • €11.5b in supply today (half-way to weekly expectations) with heavy skew to Financials (€8.7b) helped by MS bringing €5b in a 3-part.
  • €IG basket ended +0.3%, outperforming SXXP (unch) - there weren't many movers & only sector on the move was consumer cyclicals(+1.0%) on strong session for heavyweight Auto equities.

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