Spain on Thursday will........>

SPAIN AUCTION PREVIEW: Spain on Thursday will launch a new Obli 0.35% Jul-23,

and tap Obli 5.90% Jul-26 and Obli 1.40% Apr-28, for a total of E4.0-5.0bln.

- BACKGROUND: Spain has already completed just under half of its planned 2018

issuance of E126.3bln, and would reach 53% even at bottom of guidance (E4bln).

- RV/HISTORY: Spanish debt has sold off with Italian political concerns hitting

the periphery as a whole, with the 10Y spread over Bunds at 2-month highs around

79bps. That being said, the 10Y spread is not far off the post-2010 low of 64bps

set in Feb, and the bond is trading inside Italian BTPs by the most since 2011,

which suggests limited relative value from a periphery perspective. For the new

Jul-23, the closest-dated 2023s have seen a 20bps yield rise since end-March,

with spread over Bunds up around 13bps. The last tap of the 10Y benchmark Apr-28

on 3 May saw a solid cover ratio of 2.0x and an average yield of 1.29% on

E1.3bln sold, while the Jul-26 was last re-opened in Aug 2017. Cover has

averaged 2.2x at Spanish nominal bond auctions in 2018 thus far, with the 5-9

year maturity bucket a little higher at 2.5x and 10-Yrs a bit lower at 2.1x.

- RESULTS: Auction bidding closes at 0830GMT with results around 0840GMT.