Europe’s debt market sees first live deal halted this year
The EU market saw its first postponement of a live deal this year as borrowers struggled to tighten pricing in an active session for the market.
German building society Bausparkasse Schwaebisch Hall AG halted a €500 mio offering of 10y covered bonds after setting final terms. Source: Bloomberg
Global Yield Curves' (2s10s) inversion deepens, flashing recession signals
Source: Bloomberg TV Chart
Treasury longs extend
The latest JP Morgan client survey shows the most outright long positions since 2019. Source: Bloomberg
Riskier bank bonds back as returns rise, AT1 Market reopens
Two European banks on Tuesday sold the first
publicly-syndicated AT1 bonds on the continent since the Credit Suisse’s crisis.
Easing concerns about the health of the banking sector and hopes that major central banks are nearing the end of their tightening cycles contribute to the move. Source: Bloomberg
Attractiveness of EUR IG vs. US IG at decade high! 📈💼
🌍 Absolute yields in the global credit market present compelling long-term entry points, especially for high-quality European corporate bonds. Compared to the US market, the attractiveness of EUR Investment Grade (IG) credit is soaring. While concerns about a deeper recession in Europe have caused some turbulence, they have also opened up intriguing investment opportunities. Moreover, the recent Credit Suisse incident has further contributed to the dynamic landscape. 📊🔍 Is it time to seize the potential yield offered by EUR IG bonds? 💡💰 Source : Bloomberg
Is it time to increase duration in EUR bonds?
The latest European Commission survey on Eurozone selling price expectations shows a significant decline, suggesting that inflation should continue to decrease in the coming months, alleviating pressure on the ECB to tighten its monetary policy. After a possible one or two final tightening moves by the ECB in June and/or July, is it worth considering a higher allocation to European rates, particularly core bonds? Source : Bloomberg.
📈 European Investment Grade bonds ride the wave of positive momentum!
The iTraxx Main index, which monitors the 5-year credit default swaps (CDS) of IG corporate bonds, achieved a significant breakthrough by crossing the 80 bps threshold for the first time since the banking stress experienced in March. This development indicates a positive shift in market sentiment and improved confidence in the IG corporate sector. This achievement in the credit market raises an important question: Is the market too complacent with the current situation, or does it suggest that a soft landing has become the baseline scenario? Source: Bloomberg
Turkey 5-year CDS back to pre-election levels!
Market sentiment initially turned negative as the first-round results showed an unexpected rise in Erdogan's prospects for securing another presidential term. However, in a remarkable turnaround, Turkey's 5-year CDS has already returned to pre-election levels just days after Erdogan's re-election. The appointment of Mehmet Simsek as Minister of Treasury and Finance signals a positive shift towards a more conventional economic approach, bolstering market confidence post-election. Could this indicate a forthcoming adoption of a more conventional monetary policy strategy by the Turkish Central Bank? Source : Bloomberg
