CREDIT OPEN: Another batch line up, spotlight on earnings
EU stocks look set for a mildly constructive start to an earnings-laden session, particularly in the US, where updates come from 39 S&P500 firms to follow the 19 Stoxx600 members who are updating investors this morning. Among the early earnings news, Santander beat on net income while Novartis has lifted full-year guidance having also topped forecasts.
Over in Asia, markets traded mixed with Nikkei moving higher again as attempts to build a coalition continue following the LDP’s failure to secure a majority in Sunday’s parliamentary elections. Otherwise, US index futures suggest that Monday’s Wall Street gains are holding which saw S&P500 (+0.27%) and Nasdaq (+0.26%) both close in the green, albeit well off session highs in a session which also saw US yields rise to long term highs as political and fiscal jitters persist ahead of next week’s election.
Turning to today and this morning’s data won’t be market moving while the afternoon brings the first of this week’s warm-up acts for Friday’s US BLS labour market report in the form of the JOLTS survey for Sep, released alongside Oct Consumer Confidence.
Already out, German GfK Consumer Confidence improved by more than expected in Nov to -18.3 from a previously revised -21.0.
Auction supply is a notable feature where the UK sells GBP4bn 2029 Gilts which will provide an interesting test of demand given the recent pressure on UK debt amid concerns over higher borrowing as Chancellor Reeves prepares to unveil the latest budget on Wednesday. Germany also sells 5yr bonds while US conducts 2yr FRN and 7yr US sales to follow a poor 2yr auction and mediocre sale of 5yr notes on Monday.
For more on latest developments see the European Breakfast Briefing.
Tuesday’s supply prospects
A handful of names are sat in the pipeline and could pull the trigger as early as today’s business, whilst a handful of corporates (Including DSV with a six-part) are continuing roadshows today. That after unsecured financial names drove a strong start to the week for European bond activity as issuers front-loaded ahead of a raft of earnings reports and key data releases due in the coming sessions. In total we saw seven separate single currency lines price for EUR6.75bn on Monday, making a big dent in the average weekly issuance estimate of EUR19.5bn given by market participants in our weekly issuance poll.
** Slovak Republic EUR 7yr
** KBN EUR500m no grow 7yr green
** SEK USD 2.5yr FRN at SOFR +35 area IPTs
** Heimstaden Bostad EUR500m no grow 5yr
** LBBW EUR750m no grow PNC Apr 2031 AT1
** La Banque Postale Home Loan SFH EUR 6yr social covered
** Takko Fashion EUR350m 5.5yr secured
** Techem Verwaltungsgesellschaft 675 mbH EUR750m tap of 5.375% Jul 2029 secured
Activity in the US high-grade primary market was much as expected Monday as the broader markets focused their attention on upcoming earnings results from five of the so-called “magnificent seven” and a temporary easing in tensions in the Middle East. Four borrowers quietly raised USD3.8bn to kick off a week that is not expected to produce, on average, any more than USD18bn in new supply. For more colour see THE ENDGAME.
What to watch today
** Key Data: UK Sep Mortgage Approvals (09:30), US Sep P Wholesale Inventories (12:30), US Aug FHFA House Price Index (13:00), US Sep JOLTS Job Openings (14:00) and US Oct Conference Board Consumer Confidence (14:00)
** Key Events: No key events scheduled for Tuesday 29th Oct
** Auctions: UK to sell GBP4bn 2029 Gilts (10:00), GE to sell EUR4bn 2029 Bobls (10:30) and US to sell USD30bn 2yr FRNs & USD44bn 7yr Notes (17:00)
** Earnings: 19 Stoxx600 & 39 S&P500 companies report. Former includes HSBC and Santander
All times GMT
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