GERMAN BUSINESS MORALE IMPROVED DRAMATICALLY TO PUSH MARKETS HIGHER WORLDWIDE. THIS GLIMPSE OF OPTIMISM GAVE A NEEDED SHOT OF CONFIDENCE THAT INVESTORS ARE LOOKING FOR. 10 Year Treasury notes were up 4.1 basis points. S&P +1.23%, Dow +2.17%, NASDAQ +0.17%.
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Market Summaries
North American Bond Research – May 16, 2020
Posted on May 26, 2020|
HIGH YIELD BOND RESEARCH
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May 26, 2020
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Bond Markets
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 5.6 MILLION+ CASES AND 350000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 1.72 MILLION+ CASES AND 101000+ DEATHS. Among high-grade bonds showing topmost price gains at appreciable volumes traded, Hertz Corp (The) (USD) 7% 1/15/2028 made analysts’ ‘Conviction Buy’ list. (See the chart below for Hertz Corp bonds) Pierre Robert
| Key Gainers and Losers | Volume Leaders | ||||||||||||||||||||||||||||||
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Hertz Corp. 6.25% 10/15/2022 Ford Motor Co. 8.5% 4/21/2023 Ford Motor Co. 9% 4/22/2025 Petrobras Global Finance BV 7.375% 1/17/2027 Gap Inc. 5.95% 4/12/2021 Diamond Offshore Drilling 5.7% 10/15/2039 Latam Finance Limited 6.875% 4/11/2024 Reg S Teva Pharmaceutical Industries LTD 2.8% 7/21/2023 Olin Corp. 5.5% 8/15/2022 Diamond Offshore Drilling Inc. 4.875% 11/1/2043 |
| Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | Forward Calendar |
|---|---|
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(None Current 05/26/2020)
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1. Xplorenet Communictations Inc.: $1.425B credit facilities (B3/B-): $150MM revolver; $1.275B first-lien TL
2. Logmein Inc.: $3.55B credit facilities: $250MM Revolver; $2.7B first lien TL; $600MM second-lien TL 3. Whole Earth Brands (ACT II GLOBAL ACQUISTION CORP.):: $235 MM credit facilities: $50MM reolver; $185MM term A 4. Sedgwick Claimes Management Services Inc.: $300MM TL (B2/B) 5. RSA: $1.425B credit facilities: $75MM revolver; $1B TL; $350MM TL 6. Radio Systems Corp.: $725MM Loans: $100M ABL Facility; $625MM Senior secured bridge loan 7. Mohegan Tribal Gaming Authority: $100MM first lein TL (Caa1) 8. Xperi Corp. : $1.1B seven-year secured covenant lite TLB 9. Eldorado Resorts Inc./Caesars Entertainment Corp.: $6.4B credit facilities:$1B revolver at Eldorados; $3B seven-year cove-lite TLB due 2027 at Eldorado; $2.4B seven-year cove-lite TLB due 2027 at Caesars Resorts Collection 10. Championx: $537MM TL |
Additional Commentary
NEW ISSUANCE WATCH: No new issues.
| Top Widening Loans | Top Narrowing Loans |
| American Tire Distributors Inc. (USD) TL DIP PIK L+600 09/01/2023 Green Energy Partners (USD) TLB1 L+550 11/13/2021 Truck Hero Inc (USD) TL L+375 04/21/2024 Koninklijke Ten Cate NV (EUR) TLB E+350 01/27/2023 Emerald Performance Materials (USD) TL L+350 08/01/2021 |
Dubois Chemicals Inc. (USD) TL L+850 10/08/2027 Solenis Intl LP (EUR) TL E+425 6/26/2025 Hamilton Holdco LLC (USD) TLB L+200 01/02/2027 Buzz Merger Sub LTD (USD) TLB L+275 01/29/2027 Cast & Crew Payroll LLC (USD) TLB L+375 02/07/2026 |
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 25 bp (basis points), as of 05/26/2020
- Net negative capital flows into high-yield ETFs & mutual funds
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INVESTMENT GRADE BOND RESEARCH
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May 26, 2020
|
Bond Markets
GERMAN BUSINESS MORALE IMPROVED DRAMATICALLY TO PUSH MARKETS HIGHER WORLDWIDE. THIS GLIMPSE OF OPTIMISM GAVE A NEEDED SHOT OF CONFIDENCE THAT INVESTORS ARE LOOKING FOR. 10 Year Treasury notes were up 4.1 basis points. S&P +1.23%, Dow +2.17%, NASDAQ +0.17%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 5.6 MILLION+ CASES AND 350000+ DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 1.72 MILLION+ CASES AND 101000+ DEATHS. Among high-grade bonds showing topmost price gains at appreciable volumes traded, Halliburton Co. (USD) 5% 11/15/2045 made analysts’ ‘Conviction Buy’ list. (See the chart below for Halliburton Co. bonds) Pierre Robert
| Key Gainers and Losers | Volume Leaders | ||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
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AT&T Inc. 3.65% 6/1/2051 AT&T Inc. 2.75% 6/1/2031 Boeing Co. 5.805% 5/1/2050 AT&T Inc. 2.3% 6/1/2027 Boeing Co. 5.15% 5/1/2030 Banco Santander SA 2.746% 5/28/2025 Boeing Co. 5.93% 5/1/2060 AT&T Inc. 3.5% 6/1/2041 AT&T Inc. 3.85% 6/1/2060 Southwest Airlines Co. 1.25% 5/1/2025 |
| Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | New Issues [Continued] |
|---|---|
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(None Current 05/26/2020)
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Additional Commentary
NEW ISSUANCE WATCH: on 05/21/2020 participants welcome a $500MM new corporate-bond offering by Kentucky Utilities.
| Top Widening Loans | Top Narrowing Loans |
| American Tire Distributors Inc. (USD) TL DIP PIK L+600 09/01/2023 Green Energy Partners (USD) TLB1 L+550 11/13/2021 Truck Hero Inc (USD) TL L+375 04/21/2024 Koninklijke Ten Cate NV (EUR) TLB E+350 01/27/2023 Emerald Performance Materials (USD) TL L+350 08/01/2021 |
Dubois Chemicals Inc. (USD) TL L+850 10/08/2027 Solenis Intl LP (EUR) TL E+425 6/26/2025 Hamilton Holdco LLC (USD) TLB L+200 01/02/2027 Buzz Merger Sub LTD (USD) TLB L+275 01/29/2027 Cast & Crew Payroll LLC (USD) TLB L+375 02/07/2026 |
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 25 bp (basis points), as of 05/26/2020
- Net positive capital flows into high-yield ETFs & mutual funds
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