CREDIT OPEN: Plenty in the pipeline ahead of Fed

By David Corbell March 20 2024 at 06:54

EU stocks look set for a slightly defensive start as markets turn onto final approach for this evening's Fed verdict, and more pertinently the release of updated projections and presser.

Ahead of the event, utilities and energy stocks drove modest gains on Wall Street into last night's close although the 0.56% rise on S&P500 was still sufficient to drive a fresh record close.

Otherwise overnight, it's been a measured session with mainland China and HK stocks edging higher to follow the positive Wall Street lead although Nikkei was closed for a holiday. Chinese banks kept the 1- and 5-year loan prime rates unchanged at 3.45% and 3.95% respectively, surprising no one.

Ahead of today's Fed verdict comes a host of ECB speakers on the calendar including Lagarde, Lane, De Cos, Schnabel, Nagel & Villeroy.

The first half slate is data heavy and includes a UK inflation update ahead of Thursday's BoE meeting.

On the supply front, Germany sells 2.5% 2044 & 0% 2052 bunds.

Guidance by way of earnings releases is thin on the ground (just two members from the Stoxx600 and S&P500 indices report) although getting some attention this morning is a profit warning from Kering that sales at its Gucci unit plunged by 20% in Q1 on weaker Asian demand.

For more on latest developments see the European Breakfast Briefing.

Wednesday's supply prospects

Another host of issuers are sat in the pipeline with expected deals for Wednesday (see below), but we are unlikely to hit the volume heights of yesterday. As a reminder, EUR23.65bn priced in the single currency, ranking it as the sixth highest euro volume of the day so far, with chunky trades from the EU, Italy and AB Inbev leading the way. That put the weekly single currency haul at EUR35.1bn and already beyond the average weekly supply estimate of EUR31bn.

** Flemish Community EUR Jun 2034 vanilla and Jun 2045 sustainability

** Bremen EUR500m n/g 10yr LSA

** ASR Nederland EUR500m PNC8.25 RT1

** National Bank of Greece EUR 11.25NC6.25 T2

** RBI EUR650m PNC5.75 AT1

** PKO Bank EUR 4NC3 SNP

** Air Lease Corp EUR 6yr

** CBRE EUR 7- or 10-yr green

** Equinix EUR 9yr green

Stateside, 9 borrowers collectively raised USD18.2bn Tuesday, bringing ex-SSA issuance for the week to USD25.15bn, just below the average weekly estimate of USD27.5bn. For more details see THE ENDGAME.

What to watch today - FOMC verdict

** Key Data: UK Feb CPI/PPI/RPI (07:00), GE Feb PPI (07:00), IT Jan Industrial Production (09:00), US Weekly MBA Mortgage Applications (11:00) and US Mar P Consumer Confidence (15:00)

** Key Events: ECB s Lagarde (08:45), Lane (09:30), de Cos (12:00), Schnabel (13:45), Nagel (16:30) and Villeroy (16:30) speak. FOMC Verdict (18:00) and Powell presser (18.30)

** Auctions: GE to sell EUR2bn 2044 & 2052 Bunds (10:30)

** Earnings: 2 Stoxx600 and 2 S&P500 companies release results

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