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Daily Archives: 14th January 2019

14th January 2019

It’s showtime

MARKET CLOSE:
iTraxx Main

82.5bp, +1.9bp

iTraxx X-Over

342.7bp, +8.7bp

🇩🇪 10 Yr Bund

0.23%, unchanged

iBoxx Corp IG

B+178.8bp, +0.4bp

iBoxx Corp HY

B+516.6bp, +2.5bp

🇺🇸 10 Yr US T-Bond

2.70%, unchanged

🇬🇧 FTSE 100

5563.74, (-5.25%)
🇩🇪 DAX

9815.97, (+1.90%)
🇺🇸 S&P 500

2626.65, (+1.89%)

May’s Churchillian moment lost…

The time has come. We are into probably the most important week for British politics for a generation where Theresa May has already lost her chance for greatness and democracy (as we know it to be in the UK) was quashed. It’s not even about fine margins anymore. The Brexit vote will be the focus, but we will watch what happens in the immediate aftermath, as the government (as it surely will do) loses the vote on May’s deal later today.

We’re not sure that the markets had reacted or not to that news during the session, given that the Chinese export data was more important in global context. In fact, it will be a China ‘thing’ as far as markets are concerned. Its export performance was weaker than expected in December, and the fault didn’t lay squarely on the US/China trade spat. Global macro is slowing, the repercussions are really yet to be felt, and the policy response will be too late. In the meantime, Eurozone recession fears are mounting.

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