FINANCIALS: BNP - New Issue £ B'mark 10.8NC5.8 - FV

Romanian law enforcement authorities raided the houses of several suspects on Saturday after the Constitutional Court unanimously annulled the result of the first round of the presidential election even as thousands of voters abroad had already cast their ballots in the run-off. The apex court ordered a full restart of the electoral process amid suspicions that front-runner Calin Georgescu's campaign benefitted from foreign meddling linked to Russia, scrapping the run-off originally scheduled for December 8.

• The Constitutional Court rowed back on its earlier decision to accept first-round results after President Klaus Iohannis allowed secret services to declassify intelligence alleging that Russia helped promote Georgescu's presidential bid, helping him emerge from relative obscurity and win the first round of the race.
• The government will now set a new date for the election, with several observers noting that it will likely take place in March 2025. President Klaus Iohannis will likely remain in office until the election of his successor after the Constitutional Court allowed him to stay on even after his term expires on December 21.
• While staving off the risk of an pro-Russia candidate becoming head of state, the top court's decision raises the risk of undermining public trust in the electoral process and state institutions, which may resurface further down the road.

Bund futures have moved away from intraday lows, now +11 ticks today at 136.19. Bunds were pressured by the contained risk-positive move following China’s dovish monetary policy stance tweak earlier, but have since recovered as European equity and crude oil futures move off highs. 

• The December Eurozone Sentix investor confidence survey was weaker-than-expected at -17.5 (vs -12.3 cons, -12.8 prior), but had little market impact.
• German yields are within 0.5bps of Friday’s close, while 10-year EGB spreads to Bunds are a little tighter (albeit off narrowest levels).
• Political machinations in France following last week’s no confidence vote remain a key focus for EGB markets. President Macron is set to meet with parliamentary groups this morning, with Le Parisien reporting that he hopes to name a PM tomorrow. The 10-year OAT/Bund spread is ~1bp tighter at 76bps.
• We estimate EGB net flows at negative E6.6bln this week, versus negative E29.0bln last week, with issuance starting to wrap up for the year.
• Regional focus remains on Thursday’s ECB decision, MNI’s preview will be released later this week.

• The EUR is extending higher, printed a new high versus the USD, CNH, and the Yen, with some of the move being more a Function of the Dollar.
• Initial resistance in the EURUSD is above the figure, up to 1.0630 High Dec 06, but there's also 1.04bn worth of Option expiry for today at 1.0600, ahead of that Tech level.