• As expected, € IG supply yesterday was solid against a negative geo-political backdrop.
  • Reverse Yankee's underpinned supply, with Wells Fargo & Citigroup accounting for over 70% of € IG supply yesterday (a combined €5.5bn). 
• There is a window of issuance, but it is selective for credits, structures & tenors.
  • Multiple-negative headlines loom heavy (oil, Iran, Russia, Ukraine, Houthi’s, French unrest, Govt debt, mid-terms, Trump, China etc..) 
• Orderbooks are likely to remain under pressure.
  • Book multiples yesterday for FIG avg. only 2.1 X.
• Borrowers best advised to not push pricing, with NIC’s likely to be wider than recent ranges.
• This morning opens with arguably a ‘risk-off’ sentiment, though primary is proving resilient & the pipeline is solid, across Corp, FIG & SSA borrowers.
• Credit indices are wider & oil has hit a 4 month high.
• European Govie’s continued to sell-off yesterday with OAT’s notably wider by 10 to 14bps 3yrs+.
  • OAT vs Bund Differential at 148bps
  • Bund & OAT curves steepened, while the Gilt curve flattened
• UK CPI due tomorrow, with a BofE hike on Nov 5th fully priced in.
• € IG delivered €7.75bn from 6 deals (1 x Corp & 5 x FIG) via 8 tranches.
  • 41.2% of our ‘Supply Survey’ forecast of €18.83bn.
  • IPTs managed well with avg. IPT to pricing (unsecured) FIG issuance at -27.6bp
• Sterling (£) priced £500m from 1 deal (1 x SSA) via 1 tranche.
• Yet again no supply in either the Swiss Franc or US$ Reg S markets.
• Brent Crude has climbed to its highest levels since the 19th of May, currently trading at c.$110.2 (c.$107.78 this time yesterday).
• The VIX remains at elevated levels, currently set to open at 18.44 (19.99 this time yesterday).
• iTraxx 5yr Europe & iTraxx Senior & Sub financial indices were higher yesterday & are set to open at 64.902 (+1.48%), 72.623 (+1.58%) & 122.061 (+1.93%) respectively (% △ to this point yesterday).
• Pipeline:  The European IG pipeline is as follows. 
  • 2 x € Corp
  • 4 x FIG (1 x Subordinated, 1 x Covered & 1 x Snr Preferred)
  • 2 x € SSA (1 x LSA & 1 x Inaugural Green Oct 23rd earliest)

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

Key € IG Supply Stats for Yesterday

• Corporate
  • Total IG: €500m
  • Avg. tranche size €500m
  • Avg. IPT to Pricing -35.5
  • Avg. cover 6.4 X
• FIG
  • Total IG: €7.25bn
  • Avg. tranche size €1.036bn
  • Avg. IPT to Pricing -4 (covered) €500m
  • Avg. IPT to Pricing -27.58 (unsecured) €6.75bn
  • Avg. cover 2.1 X
• SSA
  • Total IG: €0
  • Avg. tranche size €0
  • Avg. IPT to Pricing NA
  • Avg. cover NA

Geo-Political News

• Crude Prices Spike Following Fresh US Threats Against Iran Crude oil surged to recent peaks following renewed statements from Trump, who raised the prospect of military strikes against Iran. This tactical pivot follows an earlier easing of security rhetoric prior to the US midterms. Trump directly threatened both economic & military action, with Tehran responding with its own retaliatory threats to destroy underwater cabling through the Strait of Hormuz vital for the region, should the US step-up its campaign. Operational risk in the Gulf region has heightened significantly, with little resolution in sight & oil prices set to remain at elevated levels.
• Urban Curfews Enacted Across France Following Widespread Civil Unrest French authorities implemented targeted night-time curfews in Marseille & multiple cities following consecutive nights of intense riots, looting, & violent confrontations with police. Security forces arrested over 2,400 individuals across Paris, Lyon, Bordeaux, & Lille after protests over economic pressures turned violent over the weekend. Public infrastructure, municipal buildings, & commercial retail centres suffered extensive structural damage, prompting emergency security deployments across affected municipalities. Government officials attributed escalation to fringe activist factions while attempting to restore order ahead of scheduled economic summits. The escalating civil disorder presents an immediate policy crisis for President Emmanuel Macron, straining domestic law enforcement resources & dampening regional economic confidence.
• Houthi Missile Strike Causes Severe Military Casualties In Shabwah A targeted Houthi missile attack struck a government military training centre in Yemen's Shabwah province, resulting in at least 53 fatalities & over 200 injuries among security recruits. The lethal strike marks a significant escalation in regional hostilities, impacting ongoing stability efforts across southern Yemen. The offensive underscores persistent tactical capabilities retained by Houthi forces despite broader regional containment measures. Neighbouring states & international observers expressed deep concern over potential renewed escalation, which threatens vital commercial maritime routes & regional diplomatic dialogue intended to secure long-term ceasefires across the Arabian Peninsula. Saudi Arabia seems stuck in a stalemate, unable to quell the ongoing conflict.
• Tripartite Nuclear Reduction Discussions Proposed Between Major Powers Trump indicated openness to initiating trilateral negotiations alongside Russia & China focused on limiting strategic nuclear arsenals. The proposal outlines potential parameters for nuclear non-proliferation & stockpile limits, seeking to establish a fresh security framework among the three global powers. Officials in Washington cited the necessity of addressing evolving strategic threats & regional force deployments through direct diplomatic engagement. Moscow & Beijing have yet to formally articulate their response, though preliminary interest has been noted across international security channels. Strategic analysts highlight that formalizing multi-power arms control agreements faces severe structural hurdles, given active regional friction points & ongoing defence modernization programs in all three sovereign states.
• Alberta Independence Referendum Escalates Canadian Federal Tensions Alberta conducted its independence referendum yesterday with polls now closed. Early polls indicate that they will remain part of Canada. The vote centres on long-standing disputes regarding natural resource management, federal taxation frameworks, & sovereign energy policies. Provincial proponents argue that administrative autonomy remains essential to protect regional economic output & industrial competitiveness. Federal officials in Ottawa expressed firm opposition, emphasizing constitutional boundaries & potential economic fragmentation across national supply networks. Arguably at a time when Canada needs unity. Alberta has confirmed the final, verified results will be officially announced on Thursday, October 29. Financial markets are closely monitoring developments, as the outcome threatens to disrupt domestic trade relationships, cross-province pipeline ventures, & broader Canadian fiscal policy stability.
• US Diplomatic Engagement Deepens Across Central Asian Republics US Secretary of State Marco Rubio conducted high-level bilateral talks in Samarkand with foreign ministers representing Uzbekistan, Kazakhstan, Kyrgyzstan, Tajikistan, & Turkmenistan. The diplomatic summit focused on strengthening regional economic partnerships, critical mineral supply chains, & trade integration across Central Asia. Washington seeks to expand commercial ties & security cooperation within a region traditionally dominated by Russian & Chinese influence. Central Asian diplomats acknowledged the importance of diversifying foreign partnerships while maintaining existing regional alliances. The talks highlight escalating diplomatic competition among major global powers for strategic influence in Central Asia, particularly regarding access to rare earth resources & transit corridors. The regional engagement underscores broader efforts by the US administration to secure strategic resource networks outside traditional supply routes.
• Beijing Proposes Restrictive Measures On Solar Technology Exports Chinese trade authorities published draft regulatory proposals aiming to restrict the export of twelve advanced solar manufacturing technologies & specialized equipment know-how. The proposed export control measures specifically target advanced manufacturing processes rather than finished solar modules, seeking to retain domestic technological sovereignty over renewable hardware production. Ministry officials framed the policy as a strategic step to protect proprietary industrial IP amid growing international trade barriers. The announcement creates significant operational uncertainty for foreign solar project developers & international manufacturers reliant on Chinese equipment components.

Markets

• US Equity markets were mixed yesterday, driven by tech strength offset by industrial weakness. The Nasdaq advanced +1.11% to 26,431, supported by robust demand across mega-cap tech shares. The S&P gained +0.41% to close at 7,691, reflecting broader market resilience. Conversely, the Dow slipped -0.07% to 51,966 as cyclical components lagged. Sector rotation remained prominent throughout trading, with capital flowing into software & semiconductor hardware while defensive sectors experienced moderate profit taking ahead of upcoming corporate earnings reports.
• Asian Equity bourses are trading in the red today, reflecting regional risk aversion. The Nikkei is down -1.15% at 64,168, weighed down by sharp declines across domestic tech exporters & industrial manufacturing shares. The Hang Seng loses -0.95% & stands at 23,957, pulled lower by property sector weakness & broader internet equity declines. The Kospi drops -4.24% to 5,523, experiencing severe selling pressure led by heavy semiconductor & battery component producers. Capital flows across Asian equity desks remain distinctly defensive throughout active trading.
• European & UK Equity European equity futures point to a negative cash market open today, reflecting broader global risk aversion & domestic corporate headwinds. FTSE futures trade down -0.50%, indicating weakness across heavy industrial & natural resource listings. DAX futures fall -0.43%, driven lower by soft auto manufacturing sentiment & chemical sector export pressures. CAC 40 futures trade down -1.12%, heavily impacted by widespread domestic civil unrest & declining retail performance. European market participants enter the morning trading session with defensive positioning across major equity indexes.
• UK & Eurozone Bond Markets Sovereign bond yields across the UK & Eurozone reflect upward pressure. 10yr Gilts stand at 5.437%, rising +0.068% on the session yesterday as fixed-income participants assess domestic debt issuance levels & elevated government borrowing requirements. Eurozone sovereign paper exhibits similar upward yield momentum. 10yr Bunds trade at 3.454%, gaining +0.043% on the day, driven by broader European debt realignments & sector supply adjustments. OATs stand at 4.933%, advancing +0.141% as domestic civil unrest in France continues to inject sovereign risk premiums into national debt pricing compared to core regional benchmark debt contracts.
• Currency Snapshot:
  • Sterling trades at 1.333 against the US dollar today, gaining +0.21% from the prior close & strengthening compared to last week when it stood at 1.319. Sterling resilience reflects solid cross-border demand despite ongoing UK fiscal headwinds.
  • Euro stands at 1.123 against the US dollar, advancing +0.18% on the day & firming compared to last week when it traded at 1.116. Against Sterling, the Euro trades at 0.843, easing -0.02% from the previous session & softening compared to last week's level of 0.846.
  • Swiss Franc trades at 0.825 against the US dollar, gaining +0.25% today & strengthening compared to last week when it recorded 0.835. Against the Euro, the Swiss Franc stands at 0.926, gaining +0.06% on the session & appreciating compared to last week's level of 0.932.

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 for the remainder of this week. The next holidays scheduled are as follows.
  • Eurozone - Next: 1st November (All Saints Day) - Sunday
  • UK - Next: Christmas Day (25 December) & Boxing Day (26 December).
  • USA - Next: 11th November (Veterans Day) & 26th November (Thanksgiving)

Pending Deals & Mandates

Euros (€)

• 19th October: National Gas Transmission plc (exp. Issue ratings of Baa1 / A- by Moody’s & Fitch), mandated BNP Paribas (B&D), HSBC, IMI - Intesa Sanpaolo, & Mizuho as Active Bookrunners to arrange a series of fixed income investor calls commencing Monday 19th Oct. A single-tranche, € benchmark, RegS bearer, fixed rate, senior, unsecured bond offering with a long 5yr tenor is expected to follow, subject to market conditions.
• 19th October: Gek Terna S.A. (rated Baa3 / BBB- by Moody’s & S&P), the vertically integrated leading infrastructure group in Greece, owning & operating critical concessions in the country, mandated BNP Paribas S.A., JP Morgan S.E. & Mediobanca – Banca di Credito Finanziario S.p.A as Joint Global Coordinators & Joint Bookrunners along with AXIA, Deutsche Bank, Eurobank S.A., Goldman Sachs Bank Europe SE, HSBC, Morgan Stanley, National Bank of Greece, Piraeus Bank S.A. & Optima bank S.A. as Joint Bookrunners to arrange a series of fixed income investor calls starting on Monday the 19th October.

• 19th October: Marsh & McLennan Companies, Inc. (rated A3 / A- / A- by Moody’s, S&P & Fitch) mandated BofA Securities, Deutsche Bank, Barclays, & HSBC to arrange a series of fixed-income investor calls, Monday, October 19th. An SEC registered Long 5yr & 10yr € benchmark, fixed rate, senior unsecured offering may follow, subject to market conditions.
• 19th October: Sumitomo Life Insurance Company (exp. Issue ratings of A- / A- by S&P & Fitch) mandated JP Morgan, BofA Securities, Goldman Sachs, SMBC Nikko & BNP Paribas to arrange a series of fixed income investor conference calls commencing Monday the 19th October. JP Morgan will be coordinating logistics. A potential € benchmark, Reg S, Fixed to fixed, step-up 30NC10 callable subordinated bond offering will follow, subject to market conditions.
• 19th October: Wüstenrot Bausparkasse AG (exp. Issue rating of AAA by S&P) mandated Commerzbank, Erste Group, LBBW, NordLB & Société Générale as Joint Lead Managers for its upcoming €500mn (wng) Mortgage Covered Bond (Hypothekenpfandbrief) with a long 8yr tenor (Jan 2035). The notes are labelled European Covered Bond (Premium). The transaction will follow in the near future, subject to market conditions.
• 19th October: Raiffeisenlandesbank Niederösterreich-Wien AG (exp. Issue rating of A2 by Moody’s) mandated BayernLB, ING, Morgan Stanley, Raiffeisen Bank International (B&D), Société Générale & UniCredit as Joint Bookrunners for its, Reg S Bearer, Senior Preferred, fixed rate, €500m (wng) Bond with a 4yr maturity, subject to market conditions.

• 16th October: The Free and Hanseatic City of Hamburg (rated AAA / AAA by Fitch & Scope) mandated DZ Bank as ESG Structuring Coordinator & Crédit Agricole CIB, Danske Bank, DekaBank, Deutsche Bank & DZ Bank as Joint Lead Managers for its upcoming inaugural €500m (wng) 10yr Green senior unsecured offering in LSA format. The transaction will be launched in the near future, subject to market conditions & after extensive investor calls taking place between Monday the 19th of October & Thursday the 22nd of October.
• 19th October: The German Federal State of Hesse (rated AA+ / AAA by S&P & Scope), mandated BayernLB, Citi, Danske Bank, Helaba, J.P. Morgan & NordLB to lead manage its upcoming 2.5yr (Apr 2029), €500m (wng) Landesschatzanweisung - LSA. Launch is expected in the near future, subject to market conditions.

Recent Supply Data

Key Market Data