Notes/Observations
- Focus on US weekly claims data and continued damage from lockdown measures
Asia:
- Australia Mar Employment Change: +5.9K v -30.0Ke; Unemployment Rate: 5.2% v 5.4%e (Note: Data was calculated between March 1-14th before any major actions were taken to slow spread of coronavirus)
- Japan govt said to be again to cut its overall economic assessment in its April report. Economic assessment expected to be described as “worsening sharply” from March reports “severe”
Coronavirus:
- Total global cases 2,064,115 (+4.2%); total deaths: 137.0k (+8.2%)
Europe:
- Italy PM Conte: Italy should look at the ESM after approval
Americas:
- President Trump stated that recent data suggested that US new coronavirus cases might have peaked and to unveil new guidelines to various State Governors via teleconference on Thursday, Apr 16th
- Sen Min Leader Schumer (D-NY): testing capacity was not adequate enough to start reopening
- Fitch cuts Mexico sovereign to BBB- (one level above junk status); outlook Stable
SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM
Equities
- Indices [Stoxx600 +0.83% at 325.74, FTSE -0.01% at 5,597.30, DAX +1.04% at 10,386.80, CAC-40 +1.02% at 4,398.90, IBEX-35 +0.36% at 6,864.00, FTSE MIB +1.67% at 16,998.50, SMI +1.09% at 9,422.00, S&P 500 Futures +0.39%]
- Market Focal Points/Key Themes: European indices open higher across the board and remained positive as the session progressed; financial sector among better performers along with technology; underperforming sectors include retail consumer discretionary and energy; reiteration of reports EU would ban dividends among companies taking state aid; several countries extend short-selling bans; upcoming earnings expected in the US session include Bank of New York, Morgan Stanley and Abbott Laboratories.
Equities
- Consumer discretionary:Zalando [ZAL.DE] +5% (prelim earnings), EasyJet [EZJ.UK] +2% (earnings)
- Financials: Ashmore [ASHM.UK] +1% (trading update)
- Healthcare: Evotec [EVT.DE] +3% (partnership)
- Industrials: Informa [INF.UK] -1% (cost reductions)
Speakers
- ECB’s Schnabel (Germany): The shape of recovery remained highly uncertain. Reiterated General Council stance that ECB stood ready to adjust all its instruments. Believed that a rate cut would not have helped at a time when banking sector profits were already under pressures (**Reminder ECB kept its key rates unchanged in March)
- EU Commission President Von der Leyen: EU budget was the cornerstone for recovery
- Germany said to provide €30B backstop for commercial credit insurers to keep trade flowing and prevent bankruptcies
- France Fin Min Le Maire: ESM could be tapped for non-health spending
- Japan PM Abe to expand State of Emergency to all 43 prefectures (nationwide) and to be in effect until May 6th
- Japan Chief Cabinet Sec Suga: Emergency declaration to be influenced by panel views
- China Commerce Ministry (MOFCOM) spokesperson Gao Feng reiterated govt stance that solid domestic economic fundamentals will not change
- China Foreign Ministry spokesperson Zhao Lijian: China was actively fulfilling its commitments to treaties on arms control; refuted US claims of conducting nuclear tests (**Note: US State Dept report said to believe China might be secretly conducting nuclear tests with very low explosive power)
- China PBoC said to further support small companies via targeted RRR cuts (**Reminder: On Apr 3rd China PBoC announced a RRR in a targeted move for smaller banks by 100bps in two phases (Apr 15th and May 15th)
Currencies/Fixed Income
- USD was again former against the major pairs due to some safe-haven flows according to dealers. Markets said to perceive declining oil prices are a symptom of weak demand as reflected in numerous economic data points. The greenback benefiting on some risk aversion sentiment. However, the sentiment did not move into other asset classes as equity and fixed income kept calm.
- EUR/USD lower by 0.3% at 1.0875, USD/JPY higher by 0.4% at 107.80.
Economic Data
- (NL) Netherlands Mar Unemployment Rate: 2.9% v 3.1%e
- (DE) Germany Mar Final CPI M/M: 0.1% v 0.1%e; Y/Y: 1.4% v 1.4%e
- (DE) Germany Mar Final CPI EU Harmonized M/M: 0.1% v 0.1%e; Y/Y: 1.3% v 1.3%e
- (DE) Germany Mar Wholesale Price Index M/M: -0.4% v -0.9% prior; Y/Y: -1.5% v -0.9% prior
- (NO) Norway Mar Trade Balance (NOK): 2.5B v 17.1B prior
- (CH) Swiss Mar Producer & Import Prices M/M: -0.3% v -1.3%e; Y/Y: -2.7% v -3.7%e
- (PH) Philippines Central Bank (BSP) cuts Overnight Borrowing Rate by 50bps to 2.75% (intra-policy decision)
- (EU) Euro Zone Feb Industrial Production M/M: -0.1% v -0.1%e; Y/Y: -1.9% v -1.9%e
- (CY) Cyprus Mar CPI Harmonized M/M: 0.2% v 0.2% prior; Y/Y: 0.1% v 1.0% prior
- (IS) Iceland Mar International Reserves (ISK): 948B v 855B prior
Fixed Income Issuance
- (ES) Spain Debt Agency (Tesoro) sold total €6.536B vs. €5.5-6.5B indicated range in 2023, 2025, 2026 and 2035 Bonds
- Sold €1.968B in 0.00% Apr 2023 SPGB bonds; Avg Yield: 0.266% v 0.107% prior; Bid-to-cover: 2.33x v 1.58x prior (Apr 2nd 2020)
- Sold €1.193B in 0.0% Jan 2025 SGPB bonds; Avg Yield: 0.411% v 0.238% prior; Bid-to-cover: 2.35x v 2.37x prior (Apr 2nd 2020)
- Sold €2.233B in 1.3% Oct 2026 SPGB bond; Avg yield: 0.592% v 1.360% prior; Bid-to-cover: 1.2x v 1.81x prior (Sept 21st 2017)
- Sold €1.142B in 1.85% July 2035 bonds; Avg Yield: 1.193% v 0.852% prior, bid-to-cover: 1.8x v 1.54x prior
- (FR) France Debt Agency (AFT) sold total €9.995B vs. €8.0-10.0B indicated range in 2023, 2024, 2026 bonds (4 tranches)
- Sold €1.868B in 0.00% Mar 2023 Oat; Avg Yield: -0.43% v -0.43% prior; Bid-to-cover: 2.62x v 1.67x prior (Mar 19th 2020)
- Sold €2.036B in 0.00% Mar 2024 Oat; Avg Yield: -0.36% v -0.49% prior; Bid-to-cover: 2.36x v 2.01x prior 9Nov 21st 2019)
- Sold €3.772B in new 0.00% Feb 2026 Oat; Avg Yield: -0.16% v -0.16%; bid-to-cover:2.60x (no history)
- Sold €2.319B in 3.50% Apr 2026 Oat; Avg Yield: -0.17% v -0.48% prior; Bid-to-cover: 2.71x v 1.47x prior
- (UK) DMO sold £3.0B in 1.5% 2026 Gilts; Avg Yield: 0.117% v 0.435% prior; Bid-to-cover: 2.38x v 1.74x prior; Tails: 0.4bps v 1.0bps prior
Looking Ahead
- 05:50 (FR) France Debt Agency (AFT) to sell €0.75-1.25B in 2028, 2029 and 2047 inflation-linked bonds (Oatei)
- 06:00 (CZ) Czech Republic to sell 6-month bills
- 06:30 (UK) DMO to sell £2.0B in 1.75% 2049 Gilts
- 06:45 (US) Daily Libor Fixing
- 07:30 (CL) Chile Central Bank (BCCh) Mar Minutes
- 07:45 (UK) BOE to buy £1.5B in APF Gilt purchase operation (3-7 years)
- 08:00 (PL) Poland Mar CPI Core M/M: 0.2%e v 0.6% prior; Y/Y: 3.4%e v 3.6% prior
- 08:00 (UK) Daily Baltic Dry Bulk Index
- 08:30 (US) Mar Housing Starts: 1.300Me v 1.599M prior; Building Permits: 1.296Me v 1.452M prior (revised from 1.464M)
- 08:30 (US) Apr Philadelphia Fed Business Outlook: -32.0e v -12.7 prior
- 08:30 (US) Initial Jobless Claims: 5.50Me v 6.606M prior; Continuing Claims: 13.260Me v 7.455M prior
- 08:30 (CA) Canada Feb Manufacturing Sales M/M: +0.1%e v -0.2% prior
- 08:30 (US) Weekly USDA Net Export Sales
- 08:45 (UK) BOE to buy £1.5B in APF Gilt purchase operation (7-20 years)
- 09:00 (RU) Russia Gold and Forex Reserve w/e Apr 10th: No est v $564.4B prior
- 09:45 (UK) BOE to buy £1.5B in APF Gilt purchase operation (20+ years)
- 10:30 (US) Weekly EIA Natural Gas Inventories
- 11:30 (US) Treasury to sell 4-week and 8-week bills
- 15:00 (AR) Argentine Feb Capacity Utilization: No est v 56.1% prior
- 18:30 (NZ) New Zealand Mar Manufacturing PMI: No est v 53.2 prior
- 19:00 (KR) South Korea Mar Unemployment Rate: 3.8%e v 3.3% prior
- 20:30 (SG) Singapore Mar Non-oil Domestic Exports M/M: -12.7%e v -4.8% prior; Y/Y: -8.0%e v +3.0% prior; Electronic Exports Y/Y: -15.0%e v +2.5% prior
- 21:00 (AU) Australia to sell A$1.0B in May 2032 bonds
- (AU) Australia to sell new Nov 2024 bond via syndicate
- 22:00 (CN) China Q1 GDP Q/Q: -12.0%e v +1.5% prior; Y/Y: -6.0%e v +6.0% prior; GDP YTD Y/Y: -5.3%e v +6.1% prior
- 22:00 (CN) China Mar Industrial Production Y/Y: -6.2%e v % prior; Industrial Production YTD Y/Y: -10.0%e v -13.5% prior
- 22:00 (CN) China Mar Retail Sales Y/Y: -10.0%e v % prior; Retail Sales YTD Y/Y: -12.5%e v -20.5% prior
- 22:00 (CN) China Mar YTD Property Investment Y/Y: No est v -16.3% prior
- 22:00 (CN) China Mar YTD Fixed Urban Assets Y/Y: -15.0%e v -24.5% prior
- 22:00 (CN) China Mar Surveyed Jobless Rate: No est v 6.2% prior
- 23:30 (JP) Japan to sell 3-Month Bills
