EU Market Update: Spanish/German 10 yr spread widens ahead of Spain's bank stress test results

Forex

Article

Articles menu

Article content

EU Market Update: Spanish/German 10 yr spread widens ahead of Spain's bank stress test results

28.09.2012 12:48 Friday
***Economic Data***
- (FR) FRANCE Q2 FINAL GDP Q/Q: 0.0% V 0.0%E; Y/Y: 0.3% V 0.3%E
- (IT) ITALY SEPT PRELIMINARY CPI EU HARMONIZED M/M: 2.1% V 0.0% PRIOR; Y/Y: 3.4% V 3.3% PRIOR
- (DE) GERMANY AUG RETAIL SALES M/M: 0.3% V 0.2%E; Y/Y: -0.8% V -0.9%E
- (FR) FRANCE AUG CONSUMER SPENDING M/M: -0.8% V -0.3%E; Y/Y: -0.5% V -0.7%E
- (FR) FRANCE AUG PRODUCER PRICES M/M: 1.2% V 0.6%E; Y/Y: 2.6% V 2.0%E
- (HU) HUNGARY Q2 CURRENT ACCOUNT: €519M V €550ME
- (ZA) SOUTH AFRICA AUG PRIVATE SECTOR CREDIT Y/Y: 7.9% V 8.0%E; M3 MONEY SUPPLY Y/Y: 7.8% V 7.7%E
- (FI) FINLAND JULY FINAL TRADE BALANCE: €21M V €60M PRELIM
- (IT) ITALY SEPT PRELIMINARY CPI (NIC INCL. TOBACCO) M/M: 0.0% V 0.4% PRIOR; Y/Y: 3.2% V 3.2% PRIOR
- (EU) EURO ZONE SEPT CPI ESTIMATE Y/Y: 2.7% V 2.4%E
- (UK) JULY INDEX OF SERVICES M/M: +1.1% V -1.7% PRIOR; 3M/3M: +0.1% V -0.1% PRIOR
- (ES) SPAIN JULY CURRENT ACCOUNT: +€500M V -€0.3B PRIOR
- (NO) NORWAY SEPT UNEMPLOYMENT RATE: 2.4% V 2.4% E
- (NO) NORWAY AUG RETAIL SALES VOLUME M/M: -0.1% V +0.6% E; Y/Y: 2.7% V 0.5%E
- (IT) ITALY AUG PPI M/M: 0.8% V 0.3%E; Y/Y: 3.0% V 2.5%E
- (SE) SWEDEN AUG RETAIL SALES M/M: -0.4% V +0.2%E; Y/Y: 1.8% V 2.7%E
- (AT) AUSTRIA AUG PRODUCER PRICE INDEX (PPI) M/M: +0.6% V -0.1% PRIOR; Y/Y: 1.0% V 0.25% PRIOR
- (AT) AUSTRIA AUG PRODUCER PRICE INDEX (PPI) M/M: +0.6% V -0.1% PRIOR; Y/Y: 1.0% V 0.25% PRIOR
- (DK) DENMARK Q2 FINAL GDP Q/Q: -0.4% V -0.4%E; Y/Y: -0.6% V -0.8%E
- (HU) HUNGARY AUG UNEMPLOYMENT RATE: 10.4% V 10.5%E
- (CH) SWISS SEPT KOF SWISS LEADING INDICATOR: 1.67 V 1.50E
- (ES) SPAIN SEPT PRELIMINARY CONSUMER PRICE INDEX (CPI) Y/Y: 3.5% V 2.8%E; CPI EU HARMONIZED Y/Y: 3.5% V 2.8%E
- (HU) HUNGARY AUG PRODUCER PRICES M/M: -0.3% V -0.4% PRIOR; Y/Y: 5.1% V 5.1%E
- (GR) GREECE AUG PPI M/M: 1.7% V 2.0% PRIOR; Y/Y: 6.5% v 3.8% PRIOR
- (GR) Greece July Retail Sales Volume: -9.1% v -10.6% prior; Value: -8% v -9.6% prior
- (HK) HONG KONG AUG MONEY SUPPLY M2 Y/Y: % V 5.1% PRIOR; M3 Y/Y: 8.5% V 5.0% PRIOR; M1 Y/Y: 8.6% V 5.9% PRIOR
- (HK) HONG KON AUG GOVERNMENT BUDGET BALANCE (HK$): -14.4B V -11.9B PRIOR
- (TH) THAILAND AUG CURRENT ACCOUNT: $858M V $300ME; TOTAL TRADE ACCOUNT BALANCE: $1.5B V $483M PRIOR; OVERALL TRADE BALANCE: $2.45B V $515M PRIOR
- (EU) ECB: €1.6B borrowed in overnight loan facility v €790M prior; €288.9B parked in deposit facility vs. €308.2B prior
- (JP) JAPAN AUG CONSTRUCTION ORDERS Y/Y: 8.7% V 8.0% PRIOR; HOUSING STARTS Y/Y:-5.5% V -9.6% PRIOR; ANNUALIZED HOUSING STARTS: 888K V 870K PRIOR
- (JP) JAPAN AUG VEHICLE PRODUCTION Y/Y: +4.5% V 16.7% PRIOR

Fixed Income:
- (IN) India sells 2017, 2026 and 2030 bonds
- (ZA) South Africa sells total ZAR800M in I/L 2025, 2038 and 2050 Bonds

*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
***Notes/Observations***

-Spanish bonds trade cautiously ahead of bank stress test results
-Prior reports have suggested that Moody's review of Spain's Baa3 sovereign rating is due at the end of Sept
-Spain continued to see capital outflows in July
-Overall, European government bonds are trading in a subdued manner going into month and quarter end.
-French yields steady ahead of budget announcement
-According to Fitch, US money market funds (MMFs) slightly raised exposures to euro zone banks in Aug, with a focus on shorter maturities
-Euro Zone Sept prelim inflation comes in hotter than expectations
-ECB Q2 money market survey shows that shorter-dated unsecured activity was most prevalent
-China money market rates move lower by over 80bps, following record cash injection by PBoC.
-Shanghai Composite extends gains amid hopes for additional support measures
-Yuan hits highest level against the USD since 1993, following speculation that the upcoming Chinese holiday has led to more domestic demand for the Chinese currency.

***Equities***
-Indices: FTSE 100 +0.30% at 5,793, DAX +0.20% at 7,302, CAC-40 -0.20% at 3,433, IBEX-35 -0.20% at 7,826, FTSE MIB flat at 15,444, SMI +0.10% at 6,552, S&P 500 Futures -0.10% at 1,440
- European equity markets opened the session with slight gains, amid some initial relief following the Spanish 2013 budget statement, but trading has been subdued going into month and quarter-end. Also, markets have remained cautious ahead of the results of the Spanish bank stress tests. Banks are broadly higher and outperformers include Barclays and Commerzbank. Resource related companies are gaining, amid the rise in commodity prices.
- In Germany, steelmaker Thyssenkrupp [TKA.DE] has outperformed the DAX, after agreeing to sell its tailored blanks unit to Wuhan Iron and Steel Corporation (WISCO). Shares of the London Stock Exchange [LSE.UK] have lost over 6%, as the company said that its LCH.Clearnet unit could have to increase its capital levels if measures recommended by the European Securities and Markets Authority (ESMA) and European Banking Authority (EBA) for European central counterparties (CCPs) are adopted. Electronic parts company, Electrocomponents [ECM.UK] has declined by over 8%, after issuing a profit warning.

Speakers:
-BoE Gov King welcomes recommendations on Libor, would like suggestions to be implemented as soon as possible.
-Malaysian PM Najib Razak said H1 GDP was 5.1%.
-German Chancellor Merkel said as the world changes, Europe has to change.
-Fitch commented that US money market funds have slightly increased their EU banking exposure, but exposures still 74% below the end of May-2011 level.
-Sweden Riksbank Ekholm said Sweden economy not suited for strong Krona.
-Russia Fin Min Siluanov said we will coordinate with the IMF on €5.0B loan to Cyprus. Russia has gotten requests for aid from 5 smaller EU countries.
-France INSEE reported Q2 Public debt up to €1.833T, 91% of GDP.
-France Fin Min Moscovici commented that France deficit reduction tax increases focus on top 10%.
-Kansas City Fed Gov George (FOMC alternate, moderate) said the Dodd-Frank act may dilute market discipline, speaking in Beijing.
-The UK's OFT is seeking to begin anti-trust probe into providers of car insurance.
-UK FSA commented that Libor should be administered by a private body and recommended that the number of libors be revised to 20 from 150. They also recommended a 12-month transition period for changes and that CAD, AUD, DKK, SEK, NZD libor rates be ended.
-India official said Telecom operators to be asked to terminate 3G roaming pacts.
-EU's Barnier noted the EU fiscal treaty is for stability not austerity.
-Hungary PM Orban said the IMF wants Hungary to give some of its money to the banks, but Hungary does not favor this. He won't cut pensions for IMF deal. Hungary wants IMF deal to cut financing costs.
-South Africa Fin Min Gordhan said that rating downgrade may raise borrowing costs. We are in a position to pay back debt.

Currencies:
- The major currencies remained stronger to the Greenback, with EUR/USD holding steady around $1.2940 before rising as high as $1.2960. Some chatter about large buys around the $1.2960 level, this will become more important when the market retests this barrier. With Italy and EU CPI we saw the single currency rise to $1.2950 before retracing back to $1.2940. GBP/USD remained unchanged at $1.6230. The USD/CHF weakened on a stronger leading KOF indicator, CHF9349 about the middle of its 45 pips range. USD/JPY was mostly weaker in the session, though did not react to the continued dispute with China, ¥77.69-77.44.

Political/ In the Papers:
-China autumn grain output may rise more than 20% y/y - Xinhua
- (EU) European Banking Authority (EBA): Europe's largest 44 banks are short €199B in core capital to meet the new Basel III requirements - De Tijd
-(FR) France PM Ayrault: Will NOT raise VAT in 2013 budget; France is weakened by debt and unemployment - French TV; 2013 GDP growth target of +0.8% y/y is realistic and achievable.
-(GR) Greece Central Bank: Greece Household and Business bank deposits end-Aug €153.4B v €153.9B prev month
-(ES) Analysts comment on Spain's 2013 budget - London Telegraph; Saxo Bank believes that the budget laid the ground for an eventually aid request, believes the Euro will resume its declines against the pound and Swiss franc; Citigroup believes that additional austerity measures could be required if the economy performs worse than expected
- (ES) Spain Dept PM Saenz: Govt will stop any effort of a Catalan referundum- Guardian
-(ES) Egan Jones cuts Spain sovereign rating to CC from CC+
- (ES) There are concerns that higher interest costs will offset Spain's new austerity measures - Telegraph's Ambrose Evans-Pritchard
-(ES) Spain Banks, Santander, BBVA and La Caxia have all passed stress tests conducted by Oliver Wyman; Official results expected later in the day - El Pais
-(UK) Fitch sees UK 2012 GDP -0.3%, 2013 at +1.5% 2014 at +2.0%

***Looking Ahead***
***All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)

- 06:00 (PT) Portugal Aug Industrial Production M/M: No est v 1.5% prior; Y/Y: No est v 0.2% prior
- 06:00 (PT) Portugal Aug Retail Sales M/M: No est v 0.1% prior; Y/Y: No est v 7.9% prior
- 06:10 (UK) DMO to sell combined £3.0B in 1-month, 3-month and 6-month Bills
- 06:30 (US) Daily LIBOR Fixings
- 07:30 (IN) India Q2 Current Account: No est v -$21.7B prior
- 07:30 (IN) India Weekly Fores Reserves
- 08:00 (BR) Brazil Aug Manufacturing PPI M/M: No est v 0.5% prior; Y/Y: No est v 7.2% prior
- 08:00 (CL) Chile Aug Manufacturing Index: No est v 0.6% prior
- 08:00 (CL) Chile Aug Unemployment Rate: No est v 6.5% prior
- 08:00 (CL) Chile Aug Total Copper Production: No est v 414.3K tons
- 08:00 (CL) Chile Aug Retail Sales Y/Y: No est v 7.9% prior
- 08:00 (PL) Poland Central Bank (NBP) Sept Inflation Expectations: 4.1%e v 4.4% prior
- 08:00 (PL) Poland Q2 Current Account: -€2.7Be v prior
- 08:00 (ZA) South Africa Aug Budget Balance (ZAR): No est v -57.6B prior
- 08:30 (CA) Canada July Gross Domestic Product M/M: No est v 0.2% prior; Y/Y: No est v 2.4% prior
- 08:30 (US) Aug Personal Income: No est v 0.3% prior; Personal Spending: No est v 0.4% prior
- 08:30 (US) Aug PCE Deflator M/M: No est v 0.0% prior; Y/Y: No est v 1.3% prior
- 08:30 (US) Aug PCE Core M/M: No est v 0.0% prior; Y/Y: No est v 1.6% prior
- 09:00 (US) Sept NAPM-Milwaukee: No est v 42.9 prior
- 09:30 (BR) Brazil Aug Primary Budget Balance (BRL): No est v 5.6B prior; Nominal Budget Balance: No est v -11.9B prior; Net Debt to GDP Ratio: No est v 34.9% prior
- 09:45 (US) Sept Chicago Purchasing Manager: No est v 53.0 prior
- 09:55 (US) Sept Final University of Michigan Confidence: No est v 79.2 Prelim
- 11:00 (US) Fed to purchase $1.50-2.00B in Notes
- 12:00 Spain expected to present bank stress results
- 12:00 (CO) Colombia Aug National Unemployment Rate: No est v 10.9% prior; Urban Unemployment Rate: No est v 11.5% prior
- 15:00 (AR) Argentina Aug Construction Activity M/M: No est v 1.6% prior; Y/Y: No est v 0.6% prior
- 15:00 (AR) Argentina Aug Economic Activity Index M/M: No est v 1.1% prior; Y/Y: No est v 0.0% prior
- 15:30 (MX) Mexico Aug YTD Budget Balance (MXN): No est v -201.0B prior

TradeTheNews.com

kk


EmediateAd










Notowania

Ads

Sonda

Reklama