• Yesterday was a nervous start to the week, yet deals did get done. Since mid-day yesterday the tone has improved slightly with oil falling, credit spreads easing from elevated levels, indices taking a breath from their wides, & of course a relative stabilisation in OAT’s (Gilts & Bunds sold off moderately since this point yesterday).
  • Improved tone this morning - yet absolute yields remain high & credit spreads remain wide.
• € IG priced €1.75bn from 2 deals (1 x Corp & 1 x FIG) & via 3 tranches.
• Sterling (£) delivered £250m from 1 deal (1 x SSA) via 1 tranche.
• Both Swiss Franc & US$ Reg S markets had zero supply.
  • The last non-domestic Chf trade was a week ago - Finland's Chf635 dual-tranche.
  • The last RegS US$ print was on the 17th of August - Nat West $500m FRN.
• Brent Crude eased slightly yet remains above the key $100 per barrel, currently trading at c.$100.78 (c.$101.49 this time yesterday). 
• The VIX has a pre-open level at 15.52 (15.31 this point yesterday).
• iTraxx Europe & iTraxx Senior & Sub financial indices widened significantly last week & are set to begin the week at 64.336 (-0.43%), 71.711 (+0.01%) & 119.713 (+0.44%) respectively (% change from this point yesterday).
• Pipeline:  The European IG pipeline is as follows. 
  • 2 x € Corp (1 x dual-tranche debut)
  • 2 x € FIG (2 x Covered)
  • 2 x € SSA

Contact Stuart Aylward with questions or comments on stuart@creditflowresearch.com

Key € IG Supply Stats for yesteday

• Corporate
  • Total IG: €1.5bn
  • Avg. tranche size €750m
  • Avg. IPT to Pricing -30
  • Avg. cover 3.57 X
• FIG
  • Total IG: €250m
  • Avg. tranche size €250m
  • Avg. IPT to Pricing -3 (covered) - €250m
  • Avg. IPT to Pricing  (unsecured) - €0
  • Avg. cover 1.36 X
• SSA
  • Total IG: €0
  • Avg. tranche size €0
  • Avg. IPT to Pricing NA
  • Avg. cover NA

Geo-Political News

• Mecca Pact Forces Deploy to Yemen Pakistan & Turkey have formally activated collective forces under the Mecca Defence Alliance to deploy military forces alongside Saudi Arabia in Yemen. The tripartite intervention responds directly to escalating offensive operations by Houthi rebels who have captured crucial strategic ground, launched sustained drone strikes against northern Saudi Arabian energy infrastructure, & threatened commercial shipping lanes through the Bab al-Mandab Strait. The Saudi-backed Yemeni government launched a comprehensive military campaign aimed at eradicating Houthi control across all Yemeni territories. By securing the southern maritime corridor, the coalition seeks to safeguard an indispensable global alternative route for crude oil exports bypassing the Strait of Hormuz. The US has been notably absent from joining efforts in Yemen, though the eradication of Iran backed Houthi rebels is clearly in the interests of the US.
• US Offers Russia Bio-Containment Support The US Department of State offered emergency biosecurity assistance & containment expertise to Russia following a fatal pathogen breach at a Siberian research facility in Irkutsk. Russian health authorities instituted strict quarantine protocols & placed nearly 200 people under medical surveillance after a laboratory worker died from suspected pneumonic plague following an accidental laboratory containment failure. While official health agencies in Moscow reported that initial diagnostic screenings of primary contacts returned negative results, international public health monitoring networks expressed elevated concern over aerosolised transmission risks associated with Yersinia pestis. The White House National Security Council confirmed it is closely tracking regional isolation measures while offering technical resources to prevent prospective cross-border dissemination. The biosecurity breach underscores lingering global vulnerabilities surrounding high-containment biological research facilities. Moscow has not formally accepted foreign technical assistance.
• Barcelona Housing Riots Escalate Widespread civil unrest & mass demonstrations swept across Barcelona as tens of thousands of residents took to the streets to protest escalating housing unaffordability & surging residential rents across Catalonia. Housing rights coalitions mounted extensive rallies alongside coordinated tenant strikes following the legislative failure of comprehensive regional rent cap reforms. The mobilization escalated into direct confrontations with local law enforcement forces guarding commercial real estate conventions & institutional investment venues. Municipal police deployed riot control measures & physical cordons as crowds attempted to block access to property development summits. Protesters highlighted that median household wage growth has lagged far behind residential real estate price inflation & speculative property acquisitions across Spain.
• Brazil Headed for Presidential Runoff Brazilian electoral authorities confirmed a high-stakes presidential runoff election scheduled for October 25^th following a tightly contested primary vote that produced no outright winner. Incumbent President Luiz Inacio Lula da Silva secured approximately 53.7m votes, narrowly trailing conservative challenger Senator Flavio Bolsonaro, who garnered over 56m votes in national balloting. The upcoming head-to-head vote highlights profound political polarization across Latin America's largest national economy, with fiscal strategy, environmental regulation, & agricultural expansion dominating core voter focus. The definitive second-round vote will shape macroeconomic policy & international trade posture for the coming decade across the region.
• Korean Border Clashes Escalating Tensions along the Demilitarized Zone on the Korean Peninsula escalated after South Korean defence officials reported that landmine explosions severely injured two frontline soldiers conducting routine security patrols. Military investigators in Seoul confirmed that the explosive devices were newly planted by North Korean military forces in direct violation of existing armistice agreements. In parallel regional security developments, international intelligence agencies disclosed evidence indicating that Russia shared advanced jet-propelled drone technology with Pyongyang in exchange for ongoing artillery munitions transfers. The cross-border incident triggered heightened tactical readiness along border guard posts as Seoul demanded a formal explanation from Pyongyang. Defence analysts warn that joint technological cooperation between Moscow & Pyongyang significantly enhances regional aerial strike capabilities.

Markets

• US Equity closed higher across major benchmarks, propelled by mega-cap tech leadership & robust capital flows into growth sectors. The Dow advanced +0.18% to close at 51,268, while the S&P rose +0.66% to end at 7,774. The Nasdaq led market gains, climbing +1.05% to 27,477 as semiconductor & enterprise software equities outperformed. Momentum reflected resilient macroeconomic liquidity & ongoing capital deployment into high-beta tech assets, overshadowing yield volatility & geopolitical friction.
• Asian Equity bourses are showing a mixed performance. Nikkei gains +0.78% to stand at 70,491, supported by exporter momentum & industrial sector buying. Hang Seng trades up +0.78% to 24,228, driven by tech rebound flows. Conversely, Kospi trades down -1.26% to stand at 6,916, weighed down by semiconductor supply chain adjustments & regional geopolitical friction along the Korean border zone.
• European & UK Equity futures indicate a fragmented opening tone. FTSE futures trade up +0.26% at 8,250, while DAX futures indicate +0.27% gains to 19,450, supported by energy & industrial order book flows. Conversely, CAC 40 futures trade down -0.77% to 7,510, constrained by luxury goods weakness & domestic policy uncertainty surrounding Southern European fiscal pressures.
• UK & Eurozone Bond Markets UK Gilts & Eurozone Sovereign debt markets face a repricing tone as 10yr Gilt yields trade at 5.421% & 10yr Bund yields stand at 3.491%. The sovereign curve posture reflects persistent inflation risk premiums & global energy supply disruptions stemming from ongoing Red Sea & Persian Gulf shipping choke points. Without scheduled macroeconomic releases or central bank communications today, traders are focused on yield spread dynamics & sovereign supply absorbing capacity across European debt desks.
• Currency Snapshot:
  • Sterling trades at 1.322 against the US dollar, moving +0.15% as foreign exchange markets evaluate UK fiscal policy stability & persistent interest rate differentials against US dollar funding curves.
  • Euro stands at 1.122 against the US dollar, posting a +0.20% gain, while trading at 0.849 against Sterling (-0.10%) amidst regional growth disparities across Core Europe.
  • Swiss Franc trades at 0.832 against the US dollar (-0.25%) & 0.933 against the Euro (+0.05%), reflecting sustained safe-haven demand amidst elevated geopolitical risk.

Economic Data (Western European Today)

Govt Bond Auctions (Western European Today)

Holidays

• There are no public or national holidays scheduled across the UK, & the Eurozone this week. The next major public holidays are:
  • USA - 12th October (Columbus Day / Indigenous Peoples' Day).
  • Spain - 12th October (National Day of Spain)
  • Eurozone - 1st November (All Saints Day) - Sunday
  • USA - 11th November (Veterans Day)

Pending Deals & Mandates

Euro (€)

• 29th September: AusNet Services Holdings Pty Limited (exp. Issue ratings of Baa1 / BBB+ by Moody’s & S&P), mandated Barclays, BNP Paribas, Goldman Sachs International & HSBC to arrange a series of fixed income investor meetings commencing Wednesday the 30th September. A € benchmark 10.5yr, Reg S senior unsecured transaction may follow, subject to market conditions. AusNet is an Australian diversified energy infrastructure business that owns & operates the primary regulated Victorian electricity transmission network, as well as an electricity distribution network in eastern Victoria & a gas distribution network in western Victoria.
• 5th October: DFMG Holding GmbH (exp. Issue ratings of BBB- / BBB by Fitch & Kroll), the leading tower infrastructure operator in Germany & Austria, mandated BNP Paribas, BBVA & Crédit Agricole CIB as Joint Active Bookrunners to arrange a series of fixed income investor calls on Monday 5th & Tuesday 6th October. BNP Paribas is coordinating logistics. A debut € benchmark Reg S, bearer, fixed-rate, senior secured dual-tranche bond offering, consisting of long 4yr & 7yr, will follow, subject to market conditions.

• 21st September: Fairstone Bank of Canada (exp. Issue ratings of Aa1 / AA by Moody’s & DBRS), mandated RBC Capital Markets as Arranger & Sole Structuring Advisor, & BMO Capital Markets, DZ Bank, LBBW, Natixis & RBC Capital Markets as Joint Active Bookrunners for an inaugural 3yr € benchmark soft-bullet Covered Bond. The Covered Bonds are backed by Canadian residential mortgages. This is the borrower's debut covered bond.
• 30th September: Equitable Bank (exp. Issue rating of Aa1 / AA+ by Moody’s & Fitch), mandated Barclays, Commerzbank, DZ Bank AG, Erste Group, LBBW, Scotiabank & TD Securities as Joint Lead Managers to manage its forthcoming €500m (wng) Dec 2029, RegS registered Covered bond transaction. The issue will be launched in the near future, subject to market conditions.

• 1st October: The Federal State of Saxony-Anhalt (rated Aa1 by Moody’s & Fitch), mandated BayernLB, CACIB, DZ Bank, ING, JP Morgan, NatWest & NordLB to lead manage its upcoming €500m (wng) inaugural Green, fixed rate Landesschatzanweisung with a medium term maturity. DZ Bank & NatWest are Joint Stability Coordinators The deal will be launched in the near future subject to market conditions.
• 5th October: The State of NRW (rated Aa1 / AA / AAA / AAA by Moody’s, S&P, Fitch & Scope) mandated BayernLB, DZ Bank, HSBC, LBBW & Rabobank to lead manage its upcoming new 10yr € benchmark fixed rate, RegS trade. The deal will be launched in the near future subject to market conditions.

Recent Supply

Key Market Data