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EUR Market Wrap

CREDIT UPDATE
  • Bunds are sitting 3-4bps tighter, underperforming gilts by -6bps at most maturities though our DM team flagged the UK CPI print may not as soft as it appeared, with services CPI only just below the BoE's Feb MPR forecasts and driven largely by a downside surprise in air fares.
  • Main/XO are -0.5bp/-3bp bringing YTD moves to -0.5bp/+7bp. FICM showing €IG/€HY at +0.4bp/+3bp with swap spreads implying slightly tighter moves vs. govies.
  • Just two EUR deals going to market today – Ald returning for a 3yr Sr Pref and Verizon with a dual tranche 8y/12y. Also have three EUR mandates from Banco BPI (covered), United Utilities and LR Health & Beauty (sub-benchmark size).
  • SXXP is +0.4% with Basic Resources and Food & Bev the notable underperformers at -0.6% and -0.4% after with Heineken (-6%) dragging drinks manufacturers lower on their earnings as flagged and Thyssenkrupp (-7.5%) dragging on materials names after cutting their outlook.
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  • Bunds are sitting 3-4bps tighter, underperforming gilts by -6bps at most maturities though our DM team flagged the UK CPI print may not as soft as it appeared, with services CPI only just below the BoE's Feb MPR forecasts and driven largely by a downside surprise in air fares.
  • Main/XO are -0.5bp/-3bp bringing YTD moves to -0.5bp/+7bp. FICM showing €IG/€HY at +0.4bp/+3bp with swap spreads implying slightly tighter moves vs. govies.
  • Just two EUR deals going to market today – Ald returning for a 3yr Sr Pref and Verizon with a dual tranche 8y/12y. Also have three EUR mandates from Banco BPI (covered), United Utilities and LR Health & Beauty (sub-benchmark size).
  • SXXP is +0.4% with Basic Resources and Food & Bev the notable underperformers at -0.6% and -0.4% after with Heineken (-6%) dragging drinks manufacturers lower on their earnings as flagged and Thyssenkrupp (-7.5%) dragging on materials names after cutting their outlook.