Grid IconAll Posts Market Summaries

North American Bond Research – February 10, 2020

Posted on February 10, 2020
HIGH YIELD BOND RESEARCH
February 10, 2020
Bond Markets

MARKETS CONTINUE THEIR UPWARD TREND! MARKET CONTINUES UP! S&P 10 year Treasury notes were down 1.1 basis points. S&P +0.73%, Dow +0.37%, NASDAQ +0.67%.
CORONA VIRUS UPDATE: CHINA TO DATE HAS HAD 28000+ CASES AND 600+ DEATHS. INFECTION HAS SPREAD TO OVER 25 COUNTRIES WITH 500+ CONFIRMED CASES.    Among high-grade bonds showing topmost price gains at appreciable volumes traded, JC Penney Co Inc (USD) 7.125% 11/15/2023 made analysts’ ‘Conviction Buy’ list. (See the chart below for JC Penney Co Inc. bonds) Pierre Robert
Key Gainers and Losers Volume Leaders
+   Whiting Petroleum Corp. 6.625% 1/15/2026 + 2.1%
  Teva Pharmaceuticals Fin BV 6% 4/15/2024 + 1.0%
  Sprint Capital Corp. 6.875% 11/15/2028 + 0.9%
–   Intelsat Luxembourg SA 8.125% 6/1/2023 -10.2%
  Washington Prime Group LP 5.95% 8/15/2024 -0.4%
  Expedia Inc. 3.8% 2/15/2028 (1) -0.2%
Intelsat Luxembourg SA   8.125% 6/1/2023
Washington Prime Group LP   5.95% 8/15/2024
Whiting Petroleum Corp.   6.625% 1/15/2026
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing 0.04% 0.04% 0.59% 3.23% 1.21% 17.52%
Mining 0.03% -0.66% -3.43% 1.60% -2.58% 2.04%
Construction 0.06% 0.30% 1.09% 2.50% 1.29% 13.84%
Manufacturing 0.05% 0.09% 0.60% 3.13% 0.91% 11.76%
Transportion, Communication, Electric/Gas 0.02% 0.00% 0.66% 2.68% 0.95% 13.48%
Wholesale 0.04% 0.09% 0.59% 2.56% 0.87% 9.91%
Retail 0.07% 0.30% 0.75% 2.33% 0.98% 13.69%
Finance, Insurance, Real-Estate 0.04% 0.22% 0.80% 2.57% 1.06% 11.75%
Services 0.08% 0.18% 0.51% 2.62% 0.74% 10.86%
Public Administration -0.28% -0.17% 0.53% 2.87% 0.90% 13.15%
Energy -0.07% -0.49% -2.34% 2.33% -1.62% 4.17%
 
Total returns (non-annualized) by rating, market weighted.

New Issues Forward Calendar
1. Banijay Group Sas (USD) 5.375% 3/1/2025 144A (02/04/2020): 403MM Secured Notes, Price at Issuance 100, Yielding 5.38%.

2. Iris Merger Sub 2019, Inc. (USD) 9.375% 2/15/2028 144A (02/04/2020): 275MM Senior Unsecured Notes, Price at Issuance 100, Yielding 9.38%.

3. Arconic Rolled Products Corp. (USD) 6.125% 2/15/2028 144A (02/05/2020): 600MM Second Lien Notes, Price at Issuance 100, Yielding 6.13%.

1. Qmax Financial Holdings Inc.: $225MM, Expected 4th Quarter 2019

2. Calpine Corp.: $1.4B bonds, Expected Q4 2019

3. Diamondback Energy Inc.: High-yield notes, Expected Q4 2019

Additional Commentary

NEW ISSUANCE WATCH: on 02/03/2020 participants welcome a $300MM new corporate-bond offering by
Castle US Holdings.  The most recent data showed money flowed in of ETF/mutual funds for the week ended 01/10/2020, with a net inflow of $9.8 billion.
Top Widening Credit Default Swaps (CDS) Top Narrowing Credit Default Swaps (CDS)
Rite Aid Corp. (5Y Sen USD MR14)
Weatherford International LTD (5Y Sen USD MR14)
Hertz Corp. (5Y Sen USD CR14)
Ghana, Republic of (5Y Sen USD CR14)
Road King Infrastructure LTD (5Y Sen USD CR14)
Export Credit Bank of Turkey (5Y Sen USD CR14)

Loans and Credit Market Overview

SYNDICATED LOANS HIGHLIGHTS:

Deals recently freed for secondary trading, notable secondary activity:

  • Symantec Corp., Broadcom LTD, Toll Brothers Inc., Cole-Parmer Instrument Co.

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 20 bp (basis points), as of 02/05/2020
  • Net negative capital flows into high-yield ETFs & mutual funds

 

INVESTMENT GRADE BOND RESEARCH
February 10, 2020
Bond Markets

MARKETS CONTINUE THEIR UPWARD TREND! MARKETS SHRUG OFF THE CORONAVIRUS AND BELIEVE TRUMP’S ACQUITTAL WILL ONLY FUEL THE MARKET’S UPWARD CLIMB.  S&P 10 year Treasury notes were down .5 basis points.  S&P +1.13%, Dow +1.68%, NASDAQ +0.43%.
CORONA VIRUS UPDATE: CHINA TO DATE HAS HAD 28000+ CASES AND 600+ DEATHS. INFECTION HAS SPREAD TO OVER 25 COUNTRIES WITH 500+ CONFIRMED CASES.  ADI proprietary index data showed a net yield increment for high-grade versus high-yield bondsHigh-yield edged out high-yield. Among high-grade bonds showing topmost price gains at appreciable volumes traded,  Anheuser Busch Companies Inc (USD) 5.75% 4/1/2036  made analysts’ ‘Conviction Buy’ list. (See the chart below for Anheuser Busch Companies Inc bonds) Pierre Robert
Key Gainers and Losers Volume Leaders
+   Wells Fargo & Co. VAR% 2/11/2031 + 0.2%
  Morgan Stanley 2.699% 1/22/2031 + 0.4%
  Citibank NA 2.85% 2/12/2021 + 0.1%
–   Bank of America Corp. VAR% 2/7/2030 -0.4%
  Bank of America Corp. VAR% 10/22/2030 -0.2%
  Energy Transfer Operating, LP 5% 5/15/2050 -0.3%
Wells Fargo & Co.   VAR% 2/11/2031
Bank of America Corp.   VAR% 2/7/2030
Bank of America Corp.   VAR% 10/22/2030
Energy Transfer Operating, LP   5% 5/15/2050
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing -0.02% 0.04% 2.02% 3.83% 2.25% 5.89%
Mining 0.27% -0.11% 1.18% 3.60% 1.68% 11.77%
Construction 0.21% -0.15% 1.58% 3.46% 2.18% 10.77%
Manufacturing 0.22% -0.09% 1.65% 3.41% 1.99% 11.73%
Transportion, Communication, Electric/Gas 0.28% -0.16% 2.05% 4.26% 2.54% 15.06%
Wholesale 0.22% -0.05% 1.72% 3.62% 1.98% 13.90%
Retail 0.27% -0.03% 1.73% 3.57% 2.00% 12.89%
Finance, Insurance, Real-Estate 0.15% -0.11% 1.27% 2.68% 1.57% 10.07%
Services 0.20% -0.08% 1.58% 3.09% 1.85% 11.22%
Public Administration 0.05% -0.15% 0.62% 1.16% 0.83% 5.10%
Energy 0.27% -0.07% 1.20% 3.74% 1.59% 12.21%
 
Total returns (non-annualized) by rating, market weighted.

New Issues New Issues [Continued]

(None Current 02/10/2020)
Additional Commentary

NEW ISSUANCE WATCH: on 02/03/2020 participants welcome a $1800MM new corporate-bond offering by Open Test CorpThe most recent data showed money flowed in of ETF/mutual funds for the week ended 01/10/2020, with a net inflow of $9.8 billion.
Top Widening Credit Default Swaps (CDS) Top Narrowing Credit Default Swaps (CDS)
Rite Aid Corp. (5Y Sen USD MR14)
Weatherford International LTD (5Y Sen USD MR14)
Hertz Corp. (5Y Sen USD CR14)
Ghana, Republic of (5Y Sen USD CR14)
Road King Infrastructure LTD (5Y Sen USD CR14)
Export Credit Bank of Turkey (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD MR14)

Loans and Credit Market Overview

SYNDICATED LOANS HIGHLIGHTS:

Deals recently freed for secondary trading, notable secondary activity:

  • Symantec Corp., Broadcom LTD, Toll Brothers Inc., Cole-Parmer Instrument Co.

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 18 bp (basis points), as of 02/04/2020
  • Net positive capital flows into high-yield ETFs & mutual funds

Copyright 2019 Advantage Data Inc. All Rights Reserved. http://www.advantagedata.com

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.

 


Are you using AdvantageData?

AdvantageData is your fixed income solution for pricing, analytics, reports, and insight on approximately:

  • 500,000+ U.S. and international corporate bonds
  • Over 6,200+ CDS reference entities
  • Over 22,000+ syndicated loans
  • Over 100 equity markets worldwide
  • One platform 16 products and services from debt to CDS to loans to mid-market
  • Used by top buy and sell-side firms worldwide

Share

facebook share icon twitter share icon linkedin share icon
Ready to get Started? Free Trial