Morning Report

Morning Report – Thursday 23rd April

Main Headlines

The ECB will accept some junk-rated debt as collateral for loans to banks, in a move that aims to shield the euro area’s most vulnerable economies as they face the risk of credit downgrades. The central bank will take bonds as long as they were rated at least BBB- as of April 7. There’s concern some government and corporate debt may be downgraded due to the fiscal costs of fighting the pandemic.

Oil extended its recovery overnight, partly fuelled by President Trump authorizing the Navy to destroy any Iranian gunboats that harass American ships. Energy producers led the advance in Asia, continuing a trend seen on Wall Street. U.S. and European futures were steady. Treasuries edged higher.


The pound halted a two-day losing streak against most currencies as Parliament prepares to scrutinize the government’s coronavirus strategy. U.K. inflation slowed in March as the nation entered lockdown and oil prices continued to tumble. The U.K. bond market looks set to face a flood of bond sales that dwarfs the current record for government borrowing set during the global financial crisis.


EU leaders meet again today to discuss the 2 trillion-euro economic revival plan. While agreement is growing around the edges, squabbling over details will probably be rife, officials said. They don’t expect to set any deadlines. Spain’s parliament backed the PM’s request to extend a state of emergency to May 9, while Italy and France posted the most new cases in the last few days. Flash PMI data for April are likely to be dire and the worst may be yet to come.


The U.S. labour market is collapsing. Another 4.5 million Americans probably filed jobless claims last week, consensus shows, some improvement from the previous 5.25 million figure. The expected number is just over 5 million, and some analysts are even more pessimistic with an estimate of 5.5 million. Either way, last week’s data would have been worse if not for the Good Friday holiday, so the unemployment rate is still headed higher. The dollar has retreated after gains earlier this week.

Main Economic Data/Central Banks/Government (All Times BST)

  • 6:30 a.m.: France April Manufacturing, Business Confidence
  • 7:00 a.m.: Germany May Consumer Confidence
  • 8:15 a.m.: France April PMIs
  • 8:30 a.m.: Germany April PMIs
  • 9:00 a.m.: Euro-Area April PMIs
  • 9:30 a.m.: U.K. April PMIs
  • 1:30 p.m.: U.S. Initial Jobless Claims

Corporate Events

Earnings include Atlas Copco, Dassault Systems, Intel, Eli Lilly.

Earnings Highlights

Credit Suisse warned it could see more impairments after its loan loss provision of 568 million Swiss francs was almost triple the estimate.
Volvo said its first-quarter truck order intake fell 16%.
Renault said revenue fell 19% to 10.1 billion euros in the period.
Pernod Ricard’s third-quarter sales fell 13% to 1.74 billion euros. It suspended buybacks.
Daimler sees 2020 revenue falling below levels in 2019.