HALISTER: TPG Said to Exit Race for $2 Billion McDonald’s China Business

TPG Said to Exit Race for $2 Billion McDonald’s China Business

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
MCD US (McDonald's Corp)
6821Z US (Bain Capital Private Equity LP)
600429 CH (Beijing Sanyuan Foods Co Ltd)
CITIC CH (CITIC Group Corp)
CG US (Carlyle Group LP/The)

People
Stephen Easterbrook (McDonald's Corp)

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UUID: 7947283

HALISTER1: TECHNICAL MONITOR: Bund Futures Resume Slide; 162.81 in Focus

TECHNICAL MONITOR: Bund Futures Resume Slide; 162.81 in Focus

(Bloomberg) -- Bund futures generic (Dec. 16) restoring downtrend after faltering at double-moving-average resistance zone, located just ahead of 164.50; downside target support area at 162.81-56, Bloomberg technical analyst Sejul Gokal writes.
  • NOTE: Click here for today’s technical, options and positioning monitors
  • RX1: Attempting to complete a bear ‘flag’ pattern, which should confirm on a close today below 163.81; momentum bearish and not oversold, with 9-day RSI at 40; interim support at 163.24 - ECB day low (see chart)
    • Daily view: Bearish
    • Daily range: Current move 51 ticks vs 58 expected (10- day average true range)
    • Resistance: 164.16; 164.54
    • Spot: 163.63
    • Support: 163.24; 162.81; 162.56
  • NOTE: For more detail on G-10 technical levels, click here
  • NOTE: Sejul Gokal is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2539Z GR (European Central Bank)

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UUID: 7947283

HALISTER1: Buy Periphery EGBs Ahead of Italy Vote, ECB Meeting: BofAML

Buy Periphery EGBs Ahead of Italy Vote, ECB Meeting: BofAML

(Bloomberg) -- Bank of America Merrill Lynch is holding a tactical long view on euro-zone periphery bonds for November following reduced ECB QE-tapering worries and positive political and bank-related news, analysts including Sphia Salim write in a note.
  • The bank sees value in going long peripheral bonds for carry in November; analysts like Italian 3y and Portuguese 5y spreads vs Germany
    • The Italian 3y looks cheap vs other peripherals and provides attractive vol-adjusted carry and roll; it should also benefit from high coupons and redemption payments
  • Spread vol likely to rise in December, driven by technical changes to QE and Italy referendum’s impact on bank recapitalizations
  • Main risk for Italian and Portuguese spreads in November is a surprise event on the banks side, any renewing concerns around recapitalization plans and a reduction in the undecided voters in the Italian referendum polls in favor of “No”
  • Any renewed ECB tapering expectations over November would also affect BTPs negatively
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2539Z GR (European Central Bank)

People
Sphia Salim (Bank of America Corp)

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UUID: 7947283

HALISTER1: Taiwan FSC to Encourage Lending to Green Energy Industries

Taiwan FSC to Encourage Lending to Green Energy Industries

(Bloomberg) -- Taiwan’s Financial Supervisory Commission will help “green energy” cos. obtain funding and financial services, according to Financial Supervisory Commission report prepared for legislators and seen by Bloomberg News.
  • To keep improving financial oversight, enhance financial information security and strengthen money laundering prevention: report
  • Report to be presented to legislature’s finance committee Thursday morning
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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UUID: 7947283

HALISTER1: Position for ECB Taper in Financials, Periphery Steepeners: SG

Position for ECB Taper in Financials, Periphery Steepeners: SG

(Bloomberg) -- Sovereign bonds, especially in the periphery, are exposed at current stretched valuations as there’s every reason to expect ECB to start scaling back QE in March 2017, SocGen strategists, including Alain Bokobza, write in client note.
  • Inflation outlook, confidence in measures so far, scarcity of assets and concerns over side-effects among key reasons to start tapering while rising inflation expectations will support the case for a slower pace of buying
  • The euro will benefit, mainly vs GBP and JPY and financials stand to win; tapering supports equity rotation at many levels
  • In stocks, favors longs in core markets vs shorts in peripherals, excluding financials
    • And recommends longs in ten cash-rich stocks vs short in ten highly leveraged stocks
    • Long consumer discretionary and financials and short staples, health care and utilities
  • In rates, recommends preparing for steeper curves particularly in the 5Y to 30Y sector
    • Any drop in demand for linkers due to PSPP tapering should be counterbalanced by increased investor interest, which should prevent falls in breakevens
  • Expect CSPP to be tapered less than other QE programs, at the start at least
    • A smaller CSPP program should make European non- financial corporates more vulnerable to spread widening in USD markets while financials could be supported by TLTRO
    • Recommend overweight financials vs non-financials when the iBOXX index spread gets to 70bps and overweight US vs Europe when iBOXX IG index spreads get to 65bps
  • Expect the ECB to extend the APP by six or nine months at its December meeting and to increase the issue limit to 50%, while maintaining the issuer limit at 33%
    • That will be followed by a gradual but stable tapering of EU10b per meeting starting in March and ending in January 2018
    • And a TLTRO-3 to be announced in June 2017 to counter negative market effects from tapering; including mortgage loans would boost volumes
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2539Z GR (European Central Bank)

People
Alain Bokobza (Societe Generale SA)

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UUID: 7947283