HomeContributorsFundamental AnalysisBond Issuance Continues At A Steady Clip

Bond Issuance Continues At A Steady Clip

Notes/Observations

  • Growing optimism around declining Covid-19 cases and the increasing likelihood that US to pass a large stimulus bill
  • Italian 10-year BTP yield at record low as overall the sentiment showing that the former ECB chief Draghi could be a game-changer for Italian politics
  • China new yuan loans at a record level ahead of lunar new year holiday

Asia:

  • PBoC Q4 Monetary Policy Report reiterated stance to keep prudent monetary policy flexible and precise; To prioritize stability and not make sharp turns in policy; To enhance flexibility of Yuan exchange rate
  • RBNZ Dep Gov Bascand stated that would reinstate mortgage lending restrictions, effective March 1st- G7 finance ministers to meet on Friday (Feb 12th) to discuss Emerging Market debt and implementation of digital taxes and central bank digital currencies

Europe:

  • ECB chief Lagarde reiterated view that resurgent virus, and curbs were significant downside risk and stressed that an accommodative monetary policy stance remained essential
  • EU said to plan to reject UK call for a 2-year extension of Northern Ireland grace periods

Americas:

  • Fed’s Mester (FOMC voter) stated that policy to be accommodative for a very long time because the economy needed it
  • House Ways and Means Committee released details of COVID plan: Comprised half of $1.9T COVID relief package, would extend unemployment insurance to Aug 29th
  • House Democrats proposed a $1.4K payments for people making $75k or married couples earning $150k, increased from the earlier proposed $50k & $100k respectfully

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

  • Indices [Stoxx600 -0.34% at 409.40, FTSE -0.05% at 6,520.55, DAX -0.05% at 5,683.08, CAC-40 % at #, IBEX-35 -1.03% at 8,134.00, FTSE MIB -0.52% at 23,301.50, SMI -0.25% at 10,752.00, S&P 500 Futures -0.10%]
  • Market Focal Points/Key Themes: European indices open mixed and later slipped to trade in the red; better performing sectors include energy and consumer discretionary; utilities and materials sectors among underperformers; Rpximus to take MTN and Swisscom’s stakes in BICS; reportedly Qiagen considering merger with Quidel; earnings expected in the upcoming US session include Lyft, Nokian Renkaat, Cisco and Twitter

Equities

  • Consumer discretionary: Ocado [OCDO.UK] -1.5% (earnings), TUI [TUI1.DE] -1% (earnings)
  • Energy: Total {FP.FR] +1% (earnings)
  • Financials: Randstad Holding [RAND.NL] +3% (earnings)
  • Healthcare: Qiagen [QIA.DE] +1% (potential merger)
  • Technology: AMS [AMS.CH] -7% (earnings)

Speakers

  • Bank of Italy (BOI) Monthly Report `Money and Banks’: Dec Non-performing Loans (NPLs): €51.6B v €62.6B prior
  • Romania Central Bank official Csaba noted that 2021 GDP seen around 3.0%. Continued to watch the effects from prior rate cuts
  • German Association of Chambers of Trade and Industry (DIHK) stated that trade and cooperation agreement with UK could only partially offset negative effects
  • BOJ said to be reluctant to abandon its EFT buying target at its March review as perception would be viewed as dialing back on stimulus
  • China President Xi stressed in a speech that needed cooperation with central and Eastern Europe and looked to expand imports for CEE countries

Currencies/Fixed Income

  • USD maintained a soft tone as focus remained on the US stimulus package currently in Congress. Greenback weighed upon as the House and Senate edge closer to a $1.9T new stimulus package
  • EUR/USD drifted back towards the 1.21 level as analysts believed the pair’s recent weakness was only temporary.
  • Italy 10-year BTP yield fell to a record low of 0.50% as market showedg confidence in Draghi to be able form a new government for Italy. Overall the sentiment is that the former ECB chief could be a game-changer for Italian politics

Economic data

  • (NO) Norway Q1 Consumer Confidence: -5.1 v -9.2 prior
  • (DE) Germany Dec Current Account Balance: €28.2B v €23.3Be; Trade Balance: €14.8B v €14.0Be; Exports M/M: +0.1% v -0.6%e; Imports M/M: -0.1% v -2.0%e
  • (FR) Bank of France Jan Industrial (Business) Sentiment: 98 v 98e
  • (CN) China Jan Aggregate Financing (CNY): 5.170T v 4.60Te
  • (CN) China Jan New Yuan Loans (CNY): 3.580T v 3.50%e (record high)
  • (CN) China Jan M2 Money Supply Y/Y: 9.4% v 10.0%e; M1 Money Supply Y/Y: 14.7 v 8.6% prior; M0 Money Supply Y/Y: -3.9% v +9.2% prior
  • (CZ) Czech Jan International Reserves: $164.6B v $166.1Bprior
  • (IT) Italy Dec Industrial Production M/M: -0.2% v +0.3%e; Y/Y: -2.0% v -1.4%e; Industrial Production NSA (unadj): Y/Y: +1.0% v -1.2% prior
  • (GR) Greece Dec Industrial Production Y/Y: 3.3% v 8.6% prior

Fixed income Issuance

  • (ID) Indonesia sold total IDR12.0T in Islamic bills and bonds (sukuk)
  • (ES) Spain Debt Agency (Tesoro) opened its book to sell EUR-denominated 50-year bond via syndicate; guidance seen 15bps to SPGBs with order book over ÂŁ37B
  • (NL) Netherlands Debt Agency (DSTA) opened its book to sell €4.0-6.0B in new 0.00% 2031 DSL bond; Spread seen +12 to +15bps with order book over €15.0B
  • (UK) DMO opened its book to sell 0.125% Mar 2051 inflation-linked Gilt (UKTi) via syndicate; guidance seen +2.75 bps to UKTi; order book over ÂŁ19.5B
  • (ZA) South Africa sold total ZAR6.6B vs. ZAR6.6B indicated in 2032, 2037 and 2044 bonds
  • (ES) Spain Debt Agency (Tesoro) sold total €6.67B vs. €6.0-7.0B indicated range in 6-month and 12-month bills

Looking Ahead

  • 05:10 (EU) Daily ECB Liquidity Stats
  • 05:15 (CH) Switzerland to sell 3-month Bills
  • 05:30 (HU) Hungary Debt Agency (AKK) to sell 3-Month Bills
  • 05:30 (BE) Belgium Debt Agency (BDA) to sell €1.8-2.2B in 3-month and 12-month bills
  • 05:30 (DE) Germany to sell €1.5B in new 0.1% Apr 2033 inflation-linked Bonds (Bundei)
  • 05:30 (EU) ECB allotment in 7-Day Main Refinancing Tender (MRO) (prior €157.0M with 8 bids recd)
  • 06:00 (PT) Portugal Dec Trade Balance: No est v -€0.9B prior
  • 06:00 (US) Jan NFIB Small Business Optimism Index: 97.5e v 95.9 prior
  • 06:00 (BR) Brazil Feb IGP-M Inflation (1st Preview): 1.8%e v 1.9% prior
  • 06:00 (FI) Finland to sell €2.0B in 6-month and 9-month Bills
  • 06:30 (EU) ESM to sell €1.1B in 12-Month Bills
  • 06:45 (US) Daily Libor Fixing
  • 07:00 (MX) Mexico Jan CPI M/M: 0.8%e v 0.4% prior; Y/Y: 3.5%e v 3.2% prior; CPI Core M/M: 0.2%e v 0.6% prior
  • 07:00 (BR) Brazil Jan IBGE Inflation IPCA M/M: 0.3%e v 1.4% prior; Y/Y: 4.6%e v 4.5% prior
  • 08:00 (UK) Daily Baltic Dry Bulk Index
  • 08:00 (RU) Russia announcement on upcoming OFZ bond issuance (held on Wed)
  • 08:55 (US) Weekly Redbook LFL Sales data
  • 09:00 (EU) Weekly ECB Forex Reserves
  • 09:30 (UR) Ukraine Jan CPI M/M: 1.5%e v 0.9% prior; Y/Y: 6.3%e v 5.0% prior
  • 09:45 (UK) BOE to buy ÂŁ1.48B in APF Gilt purchase operation (over 20-years)
  • 10:00 (US) Dec JOLTS Job Openings: 6.400Me v 6.527M prior
  • 10:00 (IE) ECB’s Lane (Ireland, chief economist)
  • 13:00 (US) Treasury to sell 3-Year Notes
  • 15:50 (AU) RBA’s Jones
  • 16:30 (US) Weekly API Oil Inventories
  • 18:00 (KR) South Korea Jan Unemployment Rate: 4.5%e v 4.6% prior
  • 18:50 (JP) Japan Jan PPI M/M: 0.4%e v 0.5% prior; Y/Y: -1.6%e v -2.0% prior
  • 19:01 (UK) Jan RICS House Price Index: 60%e v 65% prior
  • 20:30 (CN) China Jan CPI Y/Y: 0.0%e v +0.2% prior; PPI Y/Y: +0.3%e v -0.4% prior
  • 21:00 (JP) Japan Jan Tokyo Avg Office Vacancies: No est v 4.49 prior
  • 22:00 (ID) Indonesia Q4 Current Account Balance: $1.3Be v $1.0B prior

 

Trade The News
Trade The Newshttp://www.tradethenews.com/
All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.

Featured Analysis

Learn Forex Trading