There was a fairly tame morning for.....>

EGB SUMMARY: There was a fairly tame morning for core markets, only some

activity in the periphery has created interest. 

- European equity markets are showing decent gains of around 1% and is taking

the wind out of the sails of the bullish Bund market. 

- The CDU/CSU and SPD have agreed a Grand Coalition agreement. Importantly for

the periphery, the SPD have been given the all-important Finance Ministry.

Peripheral debt markets rallied strongly immediately after the news as hopes of

further European integration remained intact. 

- The Bund-BTP 10Y spread collapsed 9.3bp today to its lowest since 2016 at

120bp, helped by several block trades in BTPs over the course of the day and a

bearish move of Bunds as US markets woke up.

- Germany successfully sold E3bln of 10Y debt and the E3bln EFSF 10Y syndicated

deal met with a E14bln+ order book. 

- Currently 2Y Schatz and 10Y Bund yields are +0.9bp at -0.557% and 10Y +3.5bp

at 0.728%.