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European Bond Research – December 4, 2019

Posted on December 4, 2019
EUROPEAN BOND RESEARCH
December 4, 2019

Bond Markets


STOCKS WERE UP AS TRUMP ADMINISTRATION STATED THEY ARE CLOSE TO A DEAL. This is a reverse in tone from the President’s Tweet yesterday. FTSE 100 +0.42%, German DAX +1.16%, CAC 40 +1.27%, STOXX Europe 600 +1.18%.  The 10-year Gilt gained 7.6 basis points.

TRUMP LEFT THE NATO SUMMIT EARLY AMID A HOT MICROPHONE MOMENT WHERE OTHER LEADERS WERE CAUGHT MOCKING HIM. Impeachment judiciary committee proceedings proceeded with legal scholars commenting on Trump’s actions. All stated it was a basis of abuse of power charges. (Advantage Data Inc.). Extensive corporate-bond index data showed a net daily grade increment for high-grade versus high-yield constituents. High-yield bonds edged out high-grade debt as of 3 PM, London time.  Among European high-yield bonds showing a concurrence of top price gains at appreciable volumes traded,  ArcelorMittal SA (USD) 6.75% 3/1/2041  made some analysts ‘Conviction buy’ lists. (See the chart for ArcelorMittal SA bonds below). Pierre Robert

Credit-Default Swap Market


LATEST NEWS: Top moves, sovereign tighteners (5Y): Italy 138.99  and Spain 40.97. Sovereign wideners (5Y):  Finland 10.89 and Portugal 38.13.

New Issuance


New Issues New Issues [Continued]
1. Unione di Banche Italiane SCpA (EUR) VAR% 12/9/2021 (12/03/2019): 64MM Senior Preferred Security, Price at Issuance 100.

2. Sema Lease Uk Limited (GBP) 7% 11/25/2021 (12/03/2019): 75MM Secured Notes.

3. E.ON SE (EUR) 0% 9/29/2022 (12/03/2019): 500MM Senior Unsecured Notes.

ADI Indexes


DATA CHECK:

iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 12/04/2019, 134.01 NAV as of 12/04/2019, 104.46
Daily NAV Change (%) -0.04% Daily NAV Change (%) +0.24%

OVERALL EUROPEAN CREDIT MARKET:
The euro-zone economy shows signs of negative momentum, weakening credit rating quality, and uncertainty regarding the outcome of Brexit. Closely watched indicators and rates:

  • Eurostat’s unemployment ratecurrently 7.5% (seasonally adjusted, May 2019)
  • Eurostat’s quarterly GDP: 0.4% (2019 Q1)
  • 6-month Euribor: current value –0.333%, as of 12/03/2019

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Information in this document should not be regarded as an offer to sell or solicitation of an offer to buy bonds or any financial instruments referred to herein. All information provided in this document is believed to be accurate. However, Advantage Data and its sources make no warranties, either express or implied, as to any matter whatsoever, including but not limited to warranties of merchantability or fitness for a particular purpose. Opinions in this document are subject to change without notice. Electronic redistribution, photocopying and any other electronic or mechanical reproduction is strictly prohibited without prior written permission from Advantage Data Inc.

 


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