Halister News

(Bloomberg) -- Asian credit tighter overnight and EUR equity futures currently trading higher suggest a firmer bias to EUR credit spreads Tuesday, Bloomberg strategist Simon Ballard writes.

• Commodities rallying, led by metals, on renewed optimism for global macro outlook, driving pick-up in risk on sentiment
  • Buoying inflation expectations; Fed fund futures pricing in 100% probability of Dec. Fed rate increase
• But global economic and political uncertainty remains elevated; may damp absolute near-term risk appetite potential

• Bloomberg Barclays Eur-Agg Corporate index closed Monday at 124bps (flat); Bloomberg Barclays Eur HY index closed at 425bps (+4bps)
• CDX IG closed Monday -0.7bps at 75.62; iTraxx Asia Ex Japan IG is currently -1.8bps at 127.64 and iTraxx Australia quoted -2.3bps at 110.83

NEWS

• Corporate News
• Kingfisher 3Q B&Q U.K. LFL Sales Beat; Castorama, Brico Miss
• Homeserve 1H Pretax Gains, Confident of Meeting FY Forecasts
• Lufthansa Pilots to Strike Wednesday in Walkout Over Pay
• Uniper 9m Sales Fall 26%, Adjusted Ebitda Rises 54%
• Compass Underlying Oper Profit Beats, 2017 Expectations Positive
• Mitchells & Butlers FY Adj. Ebitda Misses, 8-Wk LFL Sales +0.5%

• Financial News
• CYBG FY16 Underlying Pretax +39% to GBP221m; CET1 Ratio 12.6%
• Credit Suisse Said to Face Tax Probe Over Undeclared Accounts
• De La Rue Says 1H In Line With Expectations; Outlook Unchanged
• Julius Baer Said to Hire Singapore Private Bankers From BSI
• Hong Leong Bank 1Q Net Income 542.6m Rgt vs 503m Rgt Y/y

• Rating News
• China Affirmed at ‘A+’ by Fitch; Outlook Stable
• S&PGR reiterates Australian credit rating warning
• Fitch: Swire Pacific Rating Intact Despite Higher 2017 Leverage

• Other News
• Fed Hike Is Certainty for Bond Traders as Market Odds Reach 100%
• Dollar’s Tremor at 6-Month Yen High Has Hedge Fund Calling a Top
• Too-Big-to-Fail Banking Finds Regulatory Loophole in Scandinavia

ANALYST VIEWS

• We do not expect a sharp widening of DM yields spreads (in 2017) in response to relative changes in fiscal policy but, with investment returns low, a moderate price divergence in DM fixed income could matter a great deal to portfolio performance: Roubini
• Outflows amid fear of higher US (and Eurozone) rates are injecting much apprehension into the investor base. It’s not yet a torrent, and the (exit) door is wide enough to accommodate the flow, but it can look awfully narrow pretty sharpish if panic sets in: creditmarketdaily.com

NEW ISSUES

• Monday was the fourth zero volume session this month
• European IG credit pipeline here and HY credit pipeline here

• NOTE: Simon Ballard is a credit strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.