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EU Credit Opening Wrap

CREDIT PRE-MARKET

Opening wrap

  • EGBs: flattening resumes as short end sinks - the German and UK curves resumed Thursday where they left off late Wednesday by flattening further, led by a short-end selloff. French PMI beat but German readings were more mixed.
  • Main/XO: both tightened (-2/-8bp) which was mirrored in cash bonds with EUR IG 3.6bp tighter and HY -6.4bp, with financials, tobacco and transport all leading the charge.
  • Equities: SXXP finished yesterday in positive territory (+0.83%) led by IT (reading across from bumper Nvidia results) but financials also had a good day (broad rally in insurers and Lloyds +6%).
  • Asia: equity markets rose, also led by the tech sector (Japan was closed) but China/HK was more mixed, though China Jan house prices was a small upside surprise.
  • Up today we have a range of ECB speakers, results from StanChart, Deutsche Tel, BASF, Allianz and Coca-Cola Europacific, alongside:
    • 23-Feb 0900 DE IFO Business Climate Index
    • 23-Feb 0900 EU ECB Consumer Expectations Survey

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