Bonds - USD
$65bn came first full week in January last week, way more than expected. This week bank earnings arrive, with the amount of post-earnings supply eyed.
Treasuries saw a steepening of the longer end of the curve in the late afternoon, and concurrently sent the 30y spread tighter by more than 3bps.
Despite Middle East geopolitical escalations and a lower equity market, new issuance has shifted into high gear on the first fully staffed day of 2020
Equities are up for the start of the New Year and IG corporate spreads are skating around the 2019 lows - positives for IG new issuance.
With fears of a year-end liquidity squeeze ebbing fast, the very front end of the core basis swap markets all leapt higher this morning.
IG new issuance (ex-SSA) last week came with $3.85bn amid good demand. 2019 closed down -4.8% compared to 2018. Surveys for January expect $120bn.
Treasuries are little-changed and swap spreads are edging wider as banks give their reactions to the Fed meeting.
IG new issuance saw $14.6bn price last week, on the upper end of expectations, and shorter dated bank issuance helped to boost the total.
November IG issuance (ex-SSA) totaled a very healthy $98.6bn, but the outlook for December is a modest $24bn. Tone remains solid.
Dealers watch for trade news as US data beats expectations. EdF launches its $2bn 50y deal. Barclays looks at GSIB scorces, balance sheets and repo.