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  • 2y/10y bunds closed +2bp/flat – DM team flagged that core FI strengthened after UK July CPI aggregates came in lower than expected, though didn't look as soft once volatile components were excluded and the rally faded. US CPI was largely in line, triggering a dovish reaction which reversed with overall impact neutral.
  • Main/XO ended -2.5bp/-10bp at 59bp/315bp while €IG/€HY was -0.3bp/-3bp. IG Fins and Energy outperformed at close to -1bp though both are wider WoW with Transport and Utils the only sectors in the green WoW. +10yr spreads lagged slightly with YTD underperformance vs. 1-3yr spreads at 17.5bp.
  • $IG/$HY were -2bp/-7bp with $IG OAS to Govies back below 1% (vs. 1.2% for €IG). Performance was pretty even across sectors with the short-end underperforming +10yr by ~1bp.
  • SXXP ended +0.5% while SPX was +0.4% for WoW moves of +1.6%/+4.9%. Notable €IG movers included Flutter +11%, Kellanova +8%, UBS +5%, RWE -6%, Albemarle -6%, VF Corp -5%, Deutsche Pfandbriefbank -5%.
  • SX5E/SPX futures are +0.4%/+0.2%. Japan Q2 GDP was stronger than forecast, but only provided fleeting yen support. China's July activity data showed mixed outcomes - retail sales were slightly stronger than expected but this was offset by slight misses on industrial production and fixed asset investment while property indicators also remained quite depressed.
  • Later the Fed’s Musalem and Harker speak and US July retail sales, August Empire & Philly Fed Indices, July trade prices, IP, inventories and jobless claims print. There are also UK June GDP, IP, trade & Q2 GDP.


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  • 2y/10y bunds closed +2bp/flat – DM team flagged that core FI strengthened after UK July CPI aggregates came in lower than expected, though didn't look as soft once volatile components were excluded and the rally faded. US CPI was largely in line, triggering a dovish reaction which reversed with overall impact neutral.
  • Main/XO ended -2.5bp/-10bp at 59bp/315bp while €IG/€HY was -0.3bp/-3bp. IG Fins and Energy outperformed at close to -1bp though both are wider WoW with Transport and Utils the only sectors in the green WoW. +10yr spreads lagged slightly with YTD underperformance vs. 1-3yr spreads at 17.5bp.
  • $IG/$HY were -2bp/-7bp with $IG OAS to Govies back below 1% (vs. 1.2% for €IG). Performance was pretty even across sectors with the short-end underperforming +10yr by ~1bp.
  • SXXP ended +0.5% while SPX was +0.4% for WoW moves of +1.6%/+4.9%. Notable €IG movers included Flutter +11%, Kellanova +8%, UBS +5%, RWE -6%, Albemarle -6%, VF Corp -5%, Deutsche Pfandbriefbank -5%.
  • SX5E/SPX futures are +0.4%/+0.2%. Japan Q2 GDP was stronger than forecast, but only provided fleeting yen support. China's July activity data showed mixed outcomes - retail sales were slightly stronger than expected but this was offset by slight misses on industrial production and fixed asset investment while property indicators also remained quite depressed.
  • Later the Fed’s Musalem and Harker speak and US July retail sales, August Empire & Philly Fed Indices, July trade prices, IP, inventories and jobless claims print. There are also UK June GDP, IP, trade & Q2 GDP.


Keep reading...Show less