Saudi Aramco’s Debut Issue

UNITED STATES

US stocks traded in the green on Friday – DOW +0.15%, S&P +0.46%, NASDAQ +0.59% – backed by March employment figures which surpassed expectations. President Trump continued his offensive on the Federal Reserve on Friday saying they should lower interest rates and taken unconventional measures to ease pressure

ASIA

Asian stocks were mixed this morning with the Nikkei at -0.18% on the back of a stronger Yen and the Hang Seng +0.18%. China’s CSI also lost 0.09% in spite of pledges from Beijing to launch financial relief measures for small and medium enterprises. China state press agency Xinhua also reported that trade talks between the US and China continue with progress having been made in the latest round of talks.

OIL

Brent added 1.35% to touch a new peak trading at over USD70 a barrel to set a new peak for 2019. This is on the back of worsening Libyan conflict and the expectation of continued OPEC supply cuts. In addition, expected breakthrough in trade relations between China and US is also raising hopes for a stronger demand.

UNITED KINGDOM

With Brexit negotiations with Labour Party leader Jeremy Corbyn having stalled, Prime Minister Theresa May hopes to restart the negotiations for a compromise plan in time for an EU leaders summit on Wednesday. The GBP continued its slide against the greenback to close at 1.3038 from1.3077 while the yield on 10Y UKT gained 1.2bps to 1.1148%.

EUROPEAN UNION

Meanwhile, France’s President Emmanuel Macron is leading calls for tough political conditions for Britain as the price for any Brexit delay with his foreign minister Jean-Yves le Drian decrying the seemingly endless Brexit process. European Council President Donald Tusk however, is pushing for the UK to be allowed up to a year to allow time to reach a new agreement. The Euro lost slightly against the USD to close at 1.1216 while the yield on 10Y DBR gained slightly to close at 0.0042%.

MIDDLE EAST

Israeli PM Benjamin Netanyahu promised annexation of some areas of the West Bank in a bid to win over right-wing support in Tuesday’s elections. Opinion polls showed Netanyahu’s Likud party trailing his top rival Benny Gantz’ Blue and White. Saudi’s Aramco, the world’s most profitable company in 2018, is planning a bond worth about $10 billion and interest in the sale has already surpassed $26 billion. People familiar to the deal indicate that initial price talk may be announced today with pricing as early as Tuesday.

RUSSIA

Ruble advanced by 0.2% to 65.3 per USD in line with EM peers. The CPI report show that prices increased +5.3% YoY/+0.3% MoM in March. Russian Eurobonds traded almost flat on Friday, RUSSIA 47 remained at upper 100 area.

LATAM

Brazil`s Petrobras is looking to sell a gas pipeline to Engie for USD 8.6 bn. The deal would provide capital to cut down on Petrobras’s debt pile, however the company is looking to raise USD 26.9 bn in total through different asset sales. Petbra bonds mostly weakened on Friday, the long end lost 50-70 bps in price however BRAZIL 47 advanced – it gained 30 bps to mid 98 level.