MNI China Daily Summary: Friday, Aug 9

MNI BRIEF: China July SME Index Stabilises

MNI BRIEF: China July CPI Hits Five Month High At 0.5% Y/Y

MNI BRIEF: Brazilian July Inflation Up To 4.50%

MNI: PBOC Net Injects CNY11.73 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Lower At 7.1449; +0.50% Y/Y

Canada Unemployment Holds Steady While Wages Still Run Hot

EZ/UK Bond Supply Calendar: UK APF Due Next Monday

EZ/UK T-Bill Calendar: Germany and France Due On Monday

RPT-MNI: Canada Sticks To Fiscal Anchors, Spends Chunk Of Windfall

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MNI Credit Weekly : All’s Well That Ends Well?

AnalysisCredit AnalysisCreditStory

MNI (LONDON) - Executive Summary: All’s Well That Ends Well?

  • Spreads finish the week marginally almost unchanged, an outcome that seemed unlikely on Monday with sheer panic bringing the weakest day in some time. A sharp recovery sees around half of the recent leg wider retraced. That tallies with the consensus view that this was a buy the dip opportunity, although some fear Middle East tensions will continue to weigh on risk. We feel VIX will struggle to retrace fully in the short term, hence spreads will struggle to reach recent tights.
  • Earnings season is ending now, with some vol still from the likes of Warner Bros and Zurich. Signs of easing input costs are helping, while labour costs remain a headwind.
  • ISM Services and Jobless Claims data helped improve macro sentiment following damaging ISM Manufacturing and NFP last week. The BoJ helped calm the JPY situation, but nerves still appear fraught; witness the outsized reaction to Thursday’s claims number.
  • Primary was set to be quiet, so it was a little surprising to see a print from Coca-Cola, particularly with a 29-year tranche. Unsurprisingly, that deal needed to come cheap.
  • Fund flows were firm in IG with outflows from HY. Supply expectations remain subdued for next week.

Full piece here: 24.08.09 MNI Credit Weekly.pdf

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MNI (LONDON) - Executive Summary: All’s Well That Ends Well?

  • Spreads finish the week marginally almost unchanged, an outcome that seemed unlikely on Monday with sheer panic bringing the weakest day in some time. A sharp recovery sees around half of the recent leg wider retraced. That tallies with the consensus view that this was a buy the dip opportunity, although some fear Middle East tensions will continue to weigh on risk. We feel VIX will struggle to retrace fully in the short term, hence spreads will struggle to reach recent tights.
  • Earnings season is ending now, with some vol still from the likes of Warner Bros and Zurich. Signs of easing input costs are helping, while labour costs remain a headwind.
  • ISM Services and Jobless Claims data helped improve macro sentiment following damaging ISM Manufacturing and NFP last week. The BoJ helped calm the JPY situation, but nerves still appear fraught; witness the outsized reaction to Thursday’s claims number.
  • Primary was set to be quiet, so it was a little surprising to see a print from Coca-Cola, particularly with a 29-year tranche. Unsurprisingly, that deal needed to come cheap.
  • Fund flows were firm in IG with outflows from HY. Supply expectations remain subdued for next week.

Full piece here: 24.08.09 MNI Credit Weekly.pdf