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European Market Update : 05/03/2013


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#1 ⇑ Haut ⇑ 05-03-2013 12:50:27

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European Market Update : 05/03/2013

Gains in US equities help push European markets to more than 4-year highs

Notes/Observations
(UK) GBP/USD hits fresh session high above $1.5165 on better than expected PMI, continued on to $1.5199, reduces likelihood of triple dip recession; EUR/GBP hits 1-week low

(GR) Greece has a solid bill auction selling 1.138B v 875M indicated, yield slightly lower

(IT) Italy yields drop over 10bps, FTSE MIB outperforms

(EU) Eurostoxx 50 hits highest level since Aug 2008

(ES) Spain 10-yr yields continue to hover near 5%

(EU) European corporate bond issuance picks up ahead of Thursday's central bank meetings.

(CN) Shanghai equities rise over 2.3%, as property firms see slight rebound

CN) China short-term money market rates decline over 100bps, as PBoC did not drain liquidity on today's session

(CN) More Chinese officials express concern about inflation. Premier Wen noted that inflationary pressures are "large"

(CN) China sets 2013 GDP growth target at 7.5% (unchanged from 2012)

(AU) Commodity currencies supported by better than expected Australia retail sales and positive outlook from the RBA after leaving rates on hold; AUD/USD tests above 1.2530

(SE) Swedish Krona hits 6-month high against the Euro on better than expected services PMI

Indices
Indices: FTSE 100 +0.70% at 6,390, DAX +1.6% at 7,813, CAC-40 +1.3% at 3,759, IBEX-35 +1.1% at 8,334, FTSE MIB +1.8% at 15,813, SMI +1.1% at 7,670, S&P 500 Futures +0.20% at 1,529

European equity markets are broadly higher, tracking the gains in US and Chinese equities. Italy's FTSE MIB has outperformed, amid the drop in Italian government bond yields. European banks are broadly firmer, led by Intesa, SocGen and UniCredit. Resources-related firms have tracked the rebound in commodity prices.

UK Movers [Standard Chartered +3% (raised FY dividend)] Germany movers [Deutsche Post +3.5% (Q4 results above ests), RWE +3.5% (FY results above ests), Deutsche Bank +2.5% (broker commentary),ThyssenKrupp +2.5% (broker commentary), Norma Group +2.5% (expected to be added to MDAX), BMW +2% (Jan-Feb sales), Hochtief +1.5% (broker commentary), Morphosys +1% (narrowed Q4 loss)]

Currencies
EUR/USD: Currency markets saw a rather benign session early on. The pair rallied from 1.3025 to 1.3055 after the European peripheral bond markets opened higher, signaling the all clear for risk-on. Service PMI data had little effect on currencies until the German PMI, which came in slightly better than expected. This pushed the EUR from 1.3045 to 1.3060. Stronger Eurozone PMI Services pushed the pair to a session high of 1.3075 before retracing back to 1.3060. The pair continued to leak back towards the 1.3015 level headed into mid-day

GBP/USD: The pair traded from 1.5130 to 1.5190 after better than expected UK Services PMI

USD/JPY: Was little changed during the early Europe session trading within 15 pips of 93.00

Fixed Income
(GR) GREECE DEBT AGENCY (PDMA) SELLS 1.138B V 875M INDICATED IN 26-WEEK BILLS; AVG YIELD 4.25% V 4.27% PRIOR; BID-TO-COVER: 1.64X V 1.68X PRIOR

(AT) AUSTRIA DEBT AGENCY (AFFA) SELLS COMBINED 1.65B V 1.65B INIDICATED IN 2022 AND 2044 RAGB BONDS

Sells 880M in 3.40% Nov 2022 RAGB; Avg Yield 1.726% v 1.934% prior; Bid-to-cover: 1.87x v 2.48x prior

Sells 770M in 3.15% Jun 2044 RAGB Bonds; Avg Yield 2.88% v 2.889% prior; Bid-to-cover: 1.7x v 2.0x prior

(EU) ECB ALLOTS 129.8B VS. 130BE IN 7-DAY MAIN REFINANCING TENDER AT FIXED 0.75%

(UK) DMO SELLS 4.0B V 4.0B INDICATED IN 1.25% 2018 GILTS; AVG YIELD 1.041% V 1.277% PRIOR; BID-TO-COVER: 2.17X V 1.83X PRIOR; TAIL: 0.4BPS V 0.2BPS PRIOR

Major Economic Data
(ES) SPAIN FEB SERVICES PMI: 44.7 V 45.8 PRIOR (1st monthly drop since Sep)

(IT) ITALY FEB PMI SERVICES: 43.6 V 43.5E

(FR) FRANCE FEB FINAL PMI SERVICES: 43.7 V 42.7E

(DE) GERMANY FEB FINAL PMI SERVICES: 54.7 V 54.1E

(EU) EURO ZONE FEB FINAL PMI SERVICES: 47.9 V 47.3E; PMI COMPOSITE: 47.9 V 47.3E

(UK) FEB PMI SERVICES: 51.8 V 51.0E (highest reading since Sept 2012)

(EU) EURO ZONE JAN RETAIL SALES M/M: 1.2% V +0.3%E; Y/Y: -1.3% V -2.9%E

Looking Ahead
06:30 (CL) Chile Jan Economic Activity Index M/M: No est v 1.2% prior; Y/Y: No est v 4.7% prior

06:30 (US) Daily Libor Fixing

07:00 (EU) ECB allotment in 7-Day Term Deposit Tender; To drain 205.5b

07:30 (TR) Turkey Central Bank announces February Real Effective Exchange Rate

07:45 (US) Weekly ICSC Chain Store Sales

08:00 (BR) Brazil Feb PMI Services: No est v 54.5 prior

08:30 (UK) DMO announces size of 3.25% 2052 Gilt for auction on March 13th

08:55 (US) Weekly Redbook Retail Sales

09:00 (MX) Mexico Feb Consumer Confidence: No est v 100.0 prior

10:00 (US) Mar IBD/TIPP Economic Optimism: 49.0e v 47.3 prior

10:00 (US) Feb ISM Non-Manufacturing. Composite: 55.0e v 55.2 prior

11:00 (US) Fed to buy $2.75-3.50B in bonds

11:30 (US) Treasury to sell $45B in 4-Week Bills

11:30 (US) Treasury to sell $25B in 52-Week Bills

14:00 (US) Fed's Lacker speaks on Monetary Policy in Washington

16:30 (US) Weekly API Oil Inventory

19:30 (AU) Australia Q4 GDP Q/Q: 0.6%e v 0.5% prior; Y/Y: 3.0%e v 3.1% prior

Written by Trade The News




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    European Market Update : 05/03/2013



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