Keeping Up the Pace

Bad news continues to roll out of Europe. The auto industry in France is to weigh up on sentiment with business confidence remaining at two year low. Germany’s (dubbed as the motor of Europe) 6 months outlook does not look good either. Statements coming out of the economy’s ministry have warned that growth in the short term will be noticeably weaker. Official third quarter figures for both countries will be released next week.

Greece continues to be in the headlines and not for the right reasons. Various papers this morning have been reporting that Greece could default on some of its bonds if they do not receive the next tranche of aid in time. EU finance ministers are scheduled to meet next Monday and market chatter is implying that EU leaders are asking to see a full report on the country’s reform progress.

All this negativity out of Europe is taking its toll on the European Equity markets that have traded in the red for the day.

However, credit still seems to be alienated from all this negativity. Despite lower volumes on the secondary markets Investment Grade Credit is continuing its positive run. Demand for new issuances remains healthy as more investors continue to chase paper.