Peter Baden, chief investment officer at Genoa Asset Management, discusses the buy side’s house view on trading fixed income following the weakening US labour market; the potential return of banking turmoil; and the risks to look out for in the chemicals sector and UK Gilts.
- Volumes across assets were low year to date. Liquidity in equities worsened but spreads in US Investment grade were still tight for 2023.
- In primary equities: There are several IPOs in Industrials on Nasdaq and NYSE on July 13.
- Data: US Inflation rate, CPI, Fed’s Beige Book, Core PPI, Initial Jobless Claims, and bank earnings.
- US axe data, which is within normal ranges, indicates a higher proportion of asks versus bids in credit.
Europe / UK
- Volumes were still low across assets. Liquidity in equities is moderate but in Euro investment grade is relatively good for year to date.
- In primary equities: There are several IPOs in Consumer Discretionary on July 10 and Industrials July 11 on Euronext.
- Data: UK unemployment rate and Payrolls on July 11. GDP and manufacturing on July 13.
- EU axe data, which is within normal ranges, suggests a slightly higher proportion of EU dealer bids Vs asks in credit
- GBP axe data, within normal ranges, suggests a much higher net buying Vs selling of credit