EU TECHNOLOGY: ASML Curve Up To 4bp Tighter Post Earnings
Jan-29 15:34
ASML A2[P]/A+
ASML is moving in the right direction for the Moody’s upgrade though we think they wait until later in the year. No real direct comps but ASML 30s sits in line with a single A corps curve with the 30s/31s 15-20bp wide of comparable SAP bonds (A+/A), adjusting for cash prices.
- ASML spreads are up to 4bp tighter post-results but still 2-4bps wider WTD.
- Looking at Moody’s pos outlook from July, they want to see strong execution on high NA EUV lithography, improved EBITDA margin, FCF growth and conservative FinPol.
- Results noted revenue recognised on two high NA EUV systems with a third system shipped.
- FY op margin -90bps YoY; we calc EBITDA margin -50bps. Moody’s forecast was -20bp.
- Reported CFO-CapEx-Divs of USD 6.7bn from USD <1bn in ‘23 (on WC) and USD 4.6bn in ‘22.
- FinPol: 5% dividend increase, no increase to announced BBs, significantly higher ST liquidity.
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US: Trump Says Speaker Johnson Has His 'Total Endorsement'
Dec-30 15:34
US President-elect Donald Trump has issued a lengthy statement on his Truth Social site endorsing House Speaker Mike Johnson (R-LA) ahead of the January 3 speaker vote on the floor of the House of Representatives.
- Trump: "Speaker Mike Johnson is a good, hard working, religious man. He will do the right thing, and we will continue to WIN. Mike has my Complete & Total Endorsement. MAGA!!!"
- The statement comes after a damaging two-week period - starting in late December - when Trump and advisor Elon Musk torpedoed a Johnson-backed plan to fund the federal government. This week, a public spat over H-1B work visas has deepened fissures between the 'Silicon Valley' faction of the GOP, led by Musk, and the conservative 'America First' bloc of Trump's MAGA movement, raising concerns that a collapse of the GOP coalition could derail Trump's agenda.
- Trump's statement appears designed to patch up the rift ahead of the speaker vote, which will kickstart a challenging 100-day period when Trump needs near-unanimous support from House Republicans to pass a reconciliation package that will include immigration and energy legislation and likely a measure to suspend the federal debt ceiling.
- Rep Thomas Massie (R-KY) has stated he will vote 'no' on Johnson with Rep Victoria Spartz (R-IN) leaning towards 'no'. Assuming all Democrats are present and vote 'no', four dissenting Republican votes will sink Johnson's bid and force another speaker ballot.
- Chad Pergram at Fox News has a useful explainer on the implications of the speaker vote here.
GILT AUCTION PREVIEW: On offer next week
Dec-30 15:32
The DMO has announced it will be looking to sell GBP4.25bln of the new 4.375% Mar-30 Gilt (ISIN: GB00BSQNRD01) at its auction next Wednesday, January 8.
STIR: BLOCK: Jun'25 SOFR Call Spreads vs. Puts
Dec-30 15:09
- 15,000 SFRM5 96.125/96.62 call spds 4.5 over SFRM5 95.56 puts vs. 95.945/0.36% crossed at 1004:08ET
