** With holidays this week on Monday and Thursday the issuance window was always going to be narrow and we perhaps could have predicted that Wednesday would be the headline grabber in terms of volumes. That said Tuesday's EUR11.8bn was a decent return (from 17 individual lines) and save for the emergence of the Kingdom of Spain with a EUR13bn mammoth 10yr, today's other 11 lines would have fallen short at just EUR8bn. Alas, Spain did show up and did so with aplomb, attracting EUR120bn in orders and pushing the day's tally to a nice round EUR21bn. For all the details see IGM’s DAILY EUR NICS & BOOKS

** Corporate issuance continued at a decent pace on Wednesday, as four new deals were launched and an existing trade was tapped. This did, however, mark a slowdown from the nine EUR lines and a GBP hybrid on Wednesday. Demand was strong enough as lead managers collated orders towards peak books, although there was some attrition for the more tightly priced lines. The four new bonds totalled EUR2.85bn. Orders had peaked had EUR9.75bn but settled at EUR6.95bn for a more modest cover of 2.44x. Among those was a 2-part from Mercedes-Benz International Finance B.V. with EUR1.15bn sold between a EUR650m 3.25yr and a EUR500m 6.25yr. Both notes priced flat to fair value at m/s+55 and +90 (IPTs +90-95 and +125-130), but orders dropped to EUR2.1bn from EUR4.3bn. Deutsche Post AG and Glencore Capital Finance both priced with NICs around 5bp. The former issued a EUR900m 7yr at m/s+83 (IPTs 115a), with most orders holding firm. The final book was EUR2.45bn, from a peak of EUR2.7bn. The latter offered a EUR750m long yr (Feb 2032) at m/s +145 (IPTs +180a) and as with Deutsche Post saw most orders hold. A peak book of EUR2.75bn settled at EUR2.4bn. HOWOGE Wohnungsbaugesellschaft mbH also priced a EUR200m tap of its Jun 2030 Social bond 5bp inside fv at m/s+110 on a EUR1bn book (EUR1.35bn peak). See IGM’s CORP SNAPSHOT

** Tuesday's supply in non-covered FIG comprised five new lines: three in the single currency and two in GBP. ABN Amro Bank NV launched a 4yr Senior Preferred deal with a Green GBS label, pricing at m/s+65 from m/s+90/95 IPTs, books were seen at EUR2.2bn peak, EUR1.9bn at allocation for the EUR1bn transaction. NIBC Bank NV was also out with a 5yr green SNP closing at m/s+130 from m/s+155 IPTs. The deal size was EUR500m and peak books of EUR1.3bn reduced to EUR1bn at allocation. Perhaps the most eye-catching deal of the day came from Eurobank Ergasias Services and Holdings S.A., benefiting from the subordinated demand seen yesterday to bring an inaugural AT1 PNC6. The deal attracted over EUR4bn of orders at peak for the EUR500m sized offering. This allowed final pricing to tighten from IPTs at 7.25% to 6.625%. The sterling market, which has been very quiet over the last week or so, saw two offerings: one from BFCM, a GBP400m long 6yr Senior Preferred deal that priced at UKT+110; books were seen at GBP700m. The other was from Danske Bank A/S, a GBP300m trade at UKT+120 that struggled to get attention with final books at GBP450m. Rather like last week, the senior offerings are pricing on or close to fv, and some reluctance on the part of investors is evident. See IGM's FIG SNAPSHOT.

** The Kingdom of Spain likes to surprise the market with larger than anticipated new deal sizes and today was no exception. We had been lagging down in single digit volumes until today with the EUR8.5bn weekly estimate likely out of the question barring a larger sovereign issuer. Not only did Spain help us to smash past the weekly average estimate we also went past the highest guess (EUR15bn) too. Its third syndication of the year and its second at the 10yr tenor was met with demand last counted at EUR120bn. This facilitated a 2bp spread compression to land at SPGB+7 (and with a 2bp NIC). Importantly for our narrative, the transaction was sized at EUR13bn and EUR3bn larger than we had anticipated (based on last year's similar issuance pattern year to date). Ontario Teachers' Finance Trust also achieved a rather spectacular outcome attracting EUR6.6bn for its new 6.5yr green bond (which is of course its second green deal and not the inaugural one as we stated earlier). We also wrote in the earlier SSA SNAPSHOT that it probably wouldn't reach the absolute order book heights that CDP Financial (EUR11bn) and CPPIB (EUR10.6bn) did in late Jan / early Feb but that hardly matters when your coverage ratio has a 6-handle. On the dollar front, BNG Bank N.V. launched a rare 10yr deal and again surprised us to the upside with the transaction size after utilising the USD4.1bn order book to print USD2bn (we had questioned whether it would do USD1.5bn given that past deals had been USD1bn and USD1.25bn albeit with the most recent of those in 2020).

** In the covered market ANZ Bank attracted a large order book for its 4yr soft-bullet, with orders hitting EUR3.5bn at the height of interest. Having set out for a benchmark offering, the issuer was able to print EUR1.5bn. The spread tightening to m/s+36 from guidance of 43bp area did lead to some orders dropping. But with final orders at EUR2.8bn the deal was still almost twice covered, including EUR270m of JLM. This was the second Australian covered bond of the month, and it followed a similar path to the previous one. Westpac’s 5yr was also EUR1.5bn, pricing on the back of a EUR2.9bn book that peaked at EUR3.3bn. The spread compression was 7bp too, landing at m/s+43. It was seen on the comps list at +40 ahead of ANZ Bank’s launch. ANZ took the week’s covered issuance to EUR4.25bn. It was the shortest deal of the week so far, with the other three lines being a long 7yr from HYPO NOE and a 5yr/10yr 2-part from Credit Mutuel Home Loan SFH

** The IGM Roadshow Calendar is your one-stop window on who, when and where. The calendar view provides an instant snapshot of which days are already earmarked for meetings in a convenient PDF format, with clickable links that take you directly to the known schedule

Wednesday's broader market developments

** European stocks traded in a narrow range with little to go on in terms major news flow as markets awaited an update on the latest in the EU-US tariff spat and looked ahead to what have now become 'key' Nvidia earnings (to be released after US close today). On the data front, French GDP was lacklustre with the YoY figure ending up at 0.6% and 20bp lower than the preliminary reading. PPI figures from France showed a large drop MoM (-4.3%). The ECBs CES showed 1yr CPI expectations back above 3%, but the market isn't acting concerned about even a near-term inflation issue. German jobs data suggested a weakening labour market. All told, Euro data was mixed, but should do nothing to put off an ECB cut next week.

** Stoxx600: traded on the positive side of the fence for the first hour or so but then gave up ground to trade marginally lower for the rest of the day, at -0.35% as we approach the end of day.

** Govvies: EGB yields are higher across jurisdictions and tenors, 1-2.5bp across the complex. Gilts underperformed with yields around 4.5bp higher at 2yr and 5bp higher at 10yr tenor, smaller moves further along the curve.

** Data:

• FR 1Q F GDP YoY came in lower than f/c at 0.6% (exp 0.8%), MoM in line at 0.1%
• FR Apr PPI YoY lower than prev at -0.8% (prev revised to -0.2%). MoM was -4.3% (prev -0.5%)
• GE May Unemployment Claims Rate in line at 6.3%
• US May 23 MBA Mortgage Applications fell -1.2% (prev -5.1%)
• US May Richmond Fed Mfg Index in line at -9 (prev -13)

What to watch Thursday - SP retail sales, US GDP and a handful of Fed speakers / Ascension Day

All times BST

---- Subscribe to read more ----

To receive this analysis plus much more, subscribe to IGM. Request your free trial of the service today.