Italy

Euro Breakup Contagion Risk Is Exploding

With existential elections looming, Sentix Euro Break-up Contagion Index - a market measure of the contagion risk from one or more countries leaving the euro area within the next 12 months period - has hit its post-2012 record recently...

How We Got Here In One Sentence

In every annual budget debate since the 1980s, one side figures out that the way to get what it wants – which is higher spending – is to frame the request in a particular, ingenious way: We have to borrow and spend way more now if we want to borrow and spend way less later.

Key Events In The Coming US

The main focus this week will be on President Trump's speech to Congress and Chair Yellen's speech which is the last before the blackout period. US durable goods, ISM, the BoC rate decision, EZ CPI, UK PMIs and a busy calendar in Australia & Scandinavia also coming up.

Frontrunning: February 27

  • Epic Oscars Mistake: Faye Dunaway, Warren Beatty Announce Wrong Best Picture Winner (Variety)
  • Oscar host Jimmy Kimmel turns Trump into recurrent punch line (Reuters)
  • After Mix-Up, Hollywood Searches for an Explanation (WSJ)
  • Trillions at Risk When Trump Speaks to Congress (BBG)
  • Bond Market Is Flashing Warning Signal on Trump Reflation Trade (WSJ)
  • Mexico Warns U.S. It'll Cut Off Nafta Talks If Tariffs Proposed (BBG)

Global Stocks Drop, Futures Flat; French Yields Slide As Political Jitters Subside

In a quiet night for markets, in which the top highlight was the Oscar's historic peddling of best picture "fake news" and where "millions" of Academy members seemingly voted illegally, European stocks were little changed after a selloff that pushed them to a two-week low, while the MSCI Asia index fells as Japan’s Topix dropped for third day. S&P futures were unchanged.

German 2Y Yield Plunges To Record -0.95%: Citi Explains Why It Will Keep Dropping

With the German Schatz plunging to a record -0.85%, Citi analysts write that the German 2Y yield will likely make new historic lows, no matter what happens in French politics, because the ECB needs to buy around EU80b 1-6y Germany by year-end, and as a result traders will keep frontrunning ECB purchases, pushing the Schatz well below -1.00%