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New issuance on Germany's Neuer Markt is regaining momentum after two months of poor price performance and diminishing investor interest. This week several deals have commanded healthy interest, partly as a result of lead managers establishing a deeper investor base among institutional buyers which are likely to be long term holders.

Wall Street greeted the decision this week by the Federal Reserve to stick with one 25bp rate rise for the moment with a relieved rally, giving a stronger underlying tone to the market as the second quarter drew to a close. There was no shortage of new issues to take advantage of the upturn. Unsurprisingly internet related stocks led the way. The IPO for Ask Jeeves Inc, got the third quarter off to a blazing start, when it jumped over 400% when it began trading yesterday (Thursday).

THE IRISH government's privatisation sale of stock in Telecom Eireann is on course for a resounding success, with a strong response from retail and institutional buyers. Already the institutional book is more than seven times covered as investors have rushed to gain exposure to an attractive company that will also act as a proxy stock for the booming Irish economy. Domestic retail buyers, who will receive 40% of the shares, have responded with equal vigour.

THE PORTUGAL Telecom 4 share offering is proving a blow-out at the retail level, with the offering already oversubscribed by eight times when the government announced the retail allocations yesterday (Thursday). Pre-registration of the 10,002,500 shares in the retail tranche began on June 18 and closes today.

Morgan Stanley Dean Witter is preparing to launch the $500m to $600m flotation of Sogecable, the Spanish cable TV group. The deal forms part of a hectic period of activity for the Spanish stockmarket - where activity has been quiet since last year's stockmarket turmoil.

THE FRENCH Trésor's privatisation sale of stock in Crédit Lyonnais has received an exceptional response from institutional and retail investors. The flotation of the bank, which has undergone a remarkable revival since its virtual bankruptcy a few years ago, was more than 20 times oversubscribed.

The Inter-American Development Bank rekindled the international market for yen securities this week when it launched a ¥100bn global bond - the first major yen offering for 16 months. Bankers said the IADB's issue was a huge tonic for the long moribund Euroyen market, which has effectively been shut since early 1998 due to a lack of arbitrage and investor interest.

The Inter-American Development Bank rekindled the international market for yen securities this week when it launched a ¥100bn global bond - the first major yen offering for 16 months. Bankers said the IADB's issue was a huge tonic for the long moribund Euroyen market, which has effectively been shut since early 1998 due to a lack of arbitrage and investor interest.

ollar swap spreads continue to oscillate in an unpredictable fashion. They widened in the early part of the week as the impending FOMC meeting loomed, but then contracted later in the week, apparently due to fears of considerable new issue supply. On Thursday, the 10 year swap sector traded in a 2bp range between 82bp over the 10 year Treasury and 84bp. The five year market swung between 69bp and 70.5bp. The positive correlation that existed between Treasuries and swaps has been broken, with spreads moving wider despite selling in the government sector.

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