US ECONOMY GROWS BY 3.2% IN FIRST QUARTER, beating expectations. Retailers boosted strong sales gains in March, contributing to the pickup in consumer spending; contrary there was a slowdown in spending on services as well as automobiles. Residential construction fell at a 2.8 percent rate, making it the fifth straight quarterly decline.
Investment Grade Bond Research – April 26, 2019Posted on April 26, 2019
|Key Gainers and Losers||Volume Leaders|
|General Motors Co. 5.95% 4/1/2049
Exxon Mobil Corp. 3.043% 3/1/2026
|Industry Returns Tracker|
|New Issues||New Issues [Continued]|
|1. Omers Finance Trust (USD) 2.5% 5/2/2024 (04/25/2019): 1250MM Senior Unsecured Notes, Price at Issuance 99.446, Yielding 2.62%.
2. Aqua America Inc. (USD) 4.276% 5/1/2049 (04/25/2019): 500MM Senior Unsecured Notes, Price at Issuance 99.999, Yielding 4.28%.
Sector RE V LTD. The most recent data showed money flowed out of high-yield ETFs/mutual funds for the week ended 4/18/19, with a net inflow of $1.1B, year-to-date $14.4B flowed into high-yield.
|Top Widening Credit Default Swaps (CDS)||Top Narrowing Credit Default Swaps (CDS)|
|Weatherford International LTD (5Y Sen USD XR14)
Hovnanian Enterprises Inc. (5Y Sen USD MR14)
|San Miguel Corp. (5Y Sen USD CR14)
Atmos Energy Corp. (5Y Sen USD MR14)
Loans and Credit Market Overview
SYNDICATED LOANS HIGHLIGHTS:
Deals recently freed for secondary trading, notable secondary activity:
- JBS USA LLC, Sundyne US Purchaser, Prysmian, Project Maple II BV, Trade Me Group LTD
OVERALL CREDIT MARKET:
Long-term bond yields are expected to hit a cyclical peak in 2019 given tight fiscal policy and lagging global economies. Europe remains checked by stubbornly low inflationary forces. Positive effects remained in force:
- TED spread held below 17 bp (basis points), as of 04/26/19
- Net positive capital flows into high-yield ETFs & mutual funds
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