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(EU) TradeTheNews.Com: EU Market Update: Italy sells at the upper end of range in bond auction, pays higher yields as officials seek to form government
(EU) TradeTheNews.Com: EU Market Update: Italy sells at the upper end of range in bond auction, pays higher yields as officials seek to form government
Wed, 27 Feb 2013 5:45 AM EST
***Need to Know***
- (IT) Italy sells at the upper end of the indicated range in auction of 5 and 10-yr bonds; pays higher yields (10-yr yield highest since Oct), saw higher bid to covers
- (UK) Prelim Q4 GDP y/y came in higher than expected +0.3% v 0.00%e, private consumption asl higher than expected, little reaction from sterling.
- (PT) Italy election uncertainty may delay Portugal's return to the bond market- Economico
- (IT) S&P issues commentary on Italy election; BBB+ rating not immediately impacted by the results; Moody's: Italy's inconclusive elections are credit negative; Would consider a downgrade if economy deteriorated or reforms stalled
- (DE) German Gov't Econ Advisor Feld (one of the 'wisemen') said to have warned that Italy election results could bring back the eurozone crisis "with a vengeance" - FAZ
- (DE) German March GfK consumer confidence in line with expectations 5.9, showing an improved outlook, EUR/USD gains a few pips on the news
- (FR) EADS stronger after FY12 results, share buyback will not impact acquisitions, not the worst to have smaller defense component right now
- (DE) BASF Strong Q4 Rev and Net better than expectations
- (CN) China think tank calling for tighter liquidity conditions
- (CH) Swiss traded Holcim down in the session expects higher sales in 2013 but will not match some segments 2012 levels; Q4 Rev and net loss worse than expectations.
- (BE) BUD higher in the session after Q4 organic rev growth beats expectations, volume lower than expected
- (NL) Imtech down on €500M rights issue and discloses expected €300M writedown
- (CN) China's largest housing developer knocks FY12 out of the park, Rev +43% y/y, beats on net, expects China to continue to tighten housing measures for foreseeable future
- (UK) BoE's Bean responds to Tucker from yesterday's session, no plans to introduce negative interest rates immediately, though nothing to stop BOE in principal
- (EU) EU Jan money supply data higher than expected, but monetary policy transmission remains impaired as private loans continue to decline
- (ES-IT) Spanish and Italian banks continued to buy sovereign debt in Jan
- (AU) Commodity currencies underperform as S&P comments on Australia
***Indices***
- FTSE 100 +0.20% at 6,284, DAX +0.20% at 7,610, CAC-40 +0.40% at 3,636, IBEX +0.40% at 8,009, FTSE MIB +0.40% at 15,616, SMI -0.10% at 7,440, S&P 500 Futures flat at 1,493
- European equity markets opened the session slightly higher, following the sharp declines seen on Tuesday's session. However, markets have pared gains, as dealers assess the Italian debt auction results. Mixed trading has been seen in the European banking sector. Underperformers include RBS, Deutsche Bank and Credit Agricole.
- UK movers [Weir Group +2.5% (raised dividend), ITV +1.5% (FY12 results rose y/y, special dividend),Centrica flat (in line FY12 results)]
- Germany movers [Kabel Deutschland -5% (concerns that Vodafone placed takeover approach on hold), Air Berlin -3.5% (convertible bond offering)]
- France movers [Bouygues +7% (FY margin improvement), EADS +5.5% (guided FY13 EBIT higher y/y, raised dividend)]
- Spain movers [Repsol +3% (asset sale)]
- Switzerland movers [Swiss Life +5.5% (FY ad profits rose y/y); Holcim -0.50% (Q4 results below ests)]
- Dutch movers [Imtech -7.7% (rights offering)]
***Economic Data***
- (DE) GERMANY MAR GFK CONSUMER CONFIDENCE: 5.9 V 5.9E
- (FR) FRANCE FEB CONSUMER CONFIDENCE: 86 V 86E
- (EU) EURO ZONE JAN M3 MONEY SUPPLY Y/Y: 3.5% V 3.2%E; M3 THREE-MONTH AVG: 3.5% V 3.4%E
- (UK) Q4 PRELIMINARY GDP Q/Q: -0.3% V -0.3%E; Y/Y: +0.3% V 0.0%E
- (EU) EURO ZONE FEB BUSINESS CLIMATE INDICATOR: -0.73 V -1.02E; CONSUMER CONFIDENCE:-23.6 V -23.6E
***Fixed Income***
- (EU) ECB allots $380B in 7-Day USD Liquidity Tender at fixed 0.65% vs. $0.0M prior
- (EU) ECB allots $6.79B in 3-month USD Liquidity Tender at fixed 0.64% vs. $302M prior
- (EU) ECB allots €8.33B in 3-Month Refinancing Tender at fixed 0.75% vs. €3.7B prior
- (IT) Italy Debt Agency (Tesoro) sold €2.5B vs. €1.75-2.5B indicated in 3.5% Nov 2017 BTP Bond; Avg Yield 3.59% v 2.94% prior; Bid-to-cover: 1.61x v 1.30X prior
- (IT) Italy Debt Agency (Tesoro) sold €4.0B v €3.0-4.0B indicated 4.50% New Nov 2023 BTP bonds, Avg yield 4.83% bid to cover 1.65x
***Currencies***
- EUR/USD: The pair trading in a 20 pip range from 1.3070 to 1.3090 during the European session until a better than expected Eurozone Business Climate Indicator pushed the pair quickly to 1.3120 as dealers bought EUR on a hopes of a good Italian auction. Actual Italy auction results were mixed and the EUR traded right back down to its 1.3070/1.3090 range.
- AUD/USD: The pair continued lower breaking support at 1.02 and hitting lows not seen since Oct 2012 after S&P announced scenarios that may weigh on Australia's sovereign rating.
- USD/JPY: The pair drift to lows around 91.60 caught in a tight range in the European session.
***Looking Ahead***
- 06:00 (BR) Brazil Feb FGV Inflation IGP-M M/M: 0.3%e v 0.3% prior; Y/Y: 8.3%e v 7.9% prior
- 06:30 (CL) Chile Central Bank's Traders Survey
- 06:30 (US) Daily Libor Fixings
- 07:00 (US) MBA Mortgage Applications w/e Feb 22nd: No est v -1.7% prior
- 07:00 (UK) Prime Minister's question time in House of Commons
- 07:00 (ZA) South African Fin Min delivers 2013 Budget
- 08:30 (BR) Brazil Jan Nominal Budget Balance (BRL): 25.2Be v 3.2B prior; Primary Budget Balance: 22.5Be v 22.3B prior; Net Debt to GDP ratio: 35.0%e v 35.1% prior
- 08:30 (US) Jan Durable Goods Orders: -4.6%e v +4.3% prior (revised from 4.6%); Durables Ex Transportation: 0.2%e v 1.0% prior (revised from1.3%); Durables Ex-Defense: no est v 1.2% prior; Capital Goods Orders Non-defense Ex Aircraft: 0.5%e v +0.2% prior; Capital Goods Shipments Non-defense Ex Aircraft: -0.9%e v +0.3%e
- 09:00 (EU) ECB member Mersch in Munich
- 10:00 (US) Jan Pending Home Sales M/M: +1.6%e v -4.3% prior; Y/Y: 7.4%e v 4.9% prior
- 10:30 (BR) Brazil Central Bank weekly currency flows
- 10:30 (US) Weekly DOE U.S. Crude Oil Inventories
- 11:00 (US) Fed to purchase $4.25-5.25B in Notes
- 13:00 (US) Treasury to sell $29B in 7-Year Notes
- 14:00 (AR) Argentina Jan Supermarket Sales Y/Y: No est v 14.1% prior
- 16:30 (US) Fed's Fisher speaks on Economy and Monetary Policy in New York
- 18:50 (JP) Japan Jan Preliminary Industrial Production M/M: 1.5%e v 2.4% prior; Y/Y: -4.8%e v 7.9% prior
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