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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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Inflows continue into Credit & US equities, ETF flows remain ~directionless, €IG spreads continue outperformance.
- The week ending Wednesday saw net inflows into €IG & HY and mild inflows into £IG. That was echoed in $IG, only point of weakness was $HY that saw some outflows - we wouldn't read too much into it - HYG ETF is coming off ~$1b of rolling weekly outflows but has been up and down last few weeks. There's been limited impact in secondary; $BB's spreads are -5bps over the week and have had a strong -70bp run this year - likely getting support from rates (index yields are still +15bps) with what seems like limited read-through to any impact on fundamentals/ICR's.
- Corporate supply (including covered) at €12b was below expectations (bbg) for ~€16b - that seemed to be reflected in books that we well covered ({NSN SBGGZ6DWX2PS <GO>}) - but we still saw NIC's (up to double digits) on offer in certain deals. $IG supply was higher than expected at $23b (c$20b), primary metrics remained firm (low single digit NIC's on some).
- €IG cash outperformance continued this week with corp's/financials -4/-3 vs. $ flat for both - its hard to blame duration mis-matches -we see € outperformance across the curve (WTD & YTD). That spread outperformance is more impressive considering US rates have sold off recently supporting US yields - UST/Bund 5yr spread is back at 195bps which is close to YTD highs.
- There is room for €IG to continue outperforming vs. historical levels - but ECB asset purchases in 2016-28 & 2020-22 vs. run-off now may colour comparisons & fair value levels over time.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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