GLOBAL MARKETS SNAP BACK FROM LAST WEEKS LOSSES. OIL LED THE WAY AS OPEC AND RUSSIA ARE HOLDING OFF A PLANNED INCREASE IN CRUDE OUTPUT. 10 Year Treasury notes were down 2 bps. S&P +1.62%, Dow +1.23%, NASDAQ +0.42%.
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Market Summaries
North American Bond Research – November 2, 2020
Posted on November 2, 2020|
HIGH YIELD BOND RESEARCH
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November 2, 2020
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Bond Markets
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 47.3 MILLION+ CASES AND 1.21 MILLION DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 9.6 MILLION+ CASES AND 237000+ 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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Pacific Gas & Electric Co. 4.95% 7/1/2050 EIG Investors Corp. 10.875% 2/1/2024 FirstEnergy Corp. 4.25% 3/15/2023 EQT Corp. 5% 1/15/2029 Pacific Gas & Electric Co. 4.55% 7/1/2030 Antero Resources Corp. 5% 3/1/2025 Diamondback Energy Inc. 3.5% 12/1/2029 EQT Corp. 3.9% 10/1/2027 The Escrow Corp. III 4.625% 7/15/2024 Delta Airlines Inc. 3.625% 3/15/2022 |
| Industry Returns Tracker | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | Forward Calendar |
|---|---|
| 1. Residential RE 2020 LTD (USD) FLT% 12/6/2024 (11/02/2020): 200MM Unsecured Notes, Price at Issuance 100.
2. Residential RE 2020 LTD (USD) 0% 12/6/2024 (11/02/2020): 50MM Unsecured Notes, Price at Issuance 74, Yielding 7.49%. 3. Residential RE 2020 LTD (USD) FLT% 12/6/2024 (11/02/2020): 150MM Unsecured Notes, Price at Issuance 100. |
1. Greystone Select Financial: $400MM TLB (Ba2/B+/BB-)
2. J.D. Power: $100MM incremental TL 3. Park Place Technologies LLC: $1.155B: $80MM revolver; $845MM TL (B2/B-); $230MM TL (Caa2/CCC) 4. Motorcity: $275MM TLB (Ba3/BB) 5. Les Schwab Tire Centers: $1.575MM TLB (B2/B) 6. PetSmart: $1150MM senior unsecured notes (Caa1/CCC+) 7. Aston Martin: $840MM senior secured notes (Caa2/CCC) 8. PetSmart: $1200MM senior secured notes (B1/B) 9. LABL Inter: $500MM senior PIK toggle (/B-) 10. Sizzling Platter: $325MM senior secured notes (B3/) |
Additional Commentary
NEW ISSUANCE WATCH: Residential RE 2020 LTD Inc issued 400 MM Notes.
| Top Widening Loans | Top Narrowing Loans |
| CPM Holdings Inc. (USD) TL2 L+825 11/16/2026 Burlington Coat Factory Warehouse Corp. (USD) TLB L+175 11/17/2024 Samsonite IP Holdings SARL (USD) TLA L+150 04/19/2023 Lucid Energy Group LLC (USD) TLB2 L+300 02/19/2025 CSM Bakery (USD) TL L+1000 02/04/2022 |
EG Group (EUR) TL E+775 03/23/2026 Tritech Software Systems (USD) TL2 L+750 08/31/2026 Cvent Inc. (USD) TL L+375 11/02/2024 Truck Hero Inc (USD) TL2 L+825 04/24/2025 Quorum Health Corp. (USD) TL EXIT L+825 04/29/2025 |
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 13 bps (basis points), as of 11/02/2020
- Net negative capital flows into high-yield ETFs & mutual funds
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INVESTMENT GRADE BOND RESEARCH
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November 2, 2020
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Bond Markets
GLOBAL MARKETS SNAP BACK FROM LAST WEEKS LOSSES. OIL LED THE WAY AS OPEC AND RUSSIA ARE HOLDING OFF A PLANNED INCREASE IN CRUDE OUTPUT. 10 Year Treasury notes were down 2 bps. S&P +1.62%, Dow +1.23%, NASDAQ +0.42%.
CORONA VIRUS UPDATE: GLOBAL CORONAVIRUS TO DATE HAS HAD 47.3 MILLION+ CASES AND 1.21 MILLION DEATHS. IN THE UNITED STATES THE CORONAVIRUS COUNT IS 9.6 MILLION+ CASES AND 237000+ 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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Boeing Co. 3.625% 2/1/2031 Bank of America Corp. VAR% 10/24/2031 FirstEnergy Corp. 3.4% 3/1/2050 Boeing Co. 1.95% 2/1/2024 Spirit Realty LP 3.4% 1/15/2030 Shell Intl. Finance BV 3.25% 5/11/2025 AT&T Inc. 5.45% 3/1/2047 Procter & Gamble Co. 1.2% 10/29/2030 Boeing Co. 2.75% 2/1/2026 Boeing Co. 5.15% 5/1/2030 |
| Industry Returns Tracker | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| New Issues | New Issues [Continued] |
|---|---|
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(None Current 11/02/2020)
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Additional Commentary
NEW ISSUANCE WATCH: No New Issues.
| Top Widening Loans | Top Narrowing Loans |
| CPM Holdings Inc. (USD) TL2 L+825 11/16/2026 Burlington Coat Factory Warehouse Corp. (USD) TLB L+175 11/17/2024 Samsonite IP Holdings SARL (USD) TLA L+150 04/19/2023 Lucid Energy Group LLC (USD) TLB2 L+300 02/19/2025 CSM Bakery (USD) TL L+1000 02/04/2022 |
EG Group (EUR) TL E+775 03/23/2026 Tritech Software Systems (USD) TL2 L+750 08/31/2026 Cvent Inc. (USD) TL L+375 11/02/2024 Truck Hero Inc (USD) TL2 L+825 04/24/2025 Quorum Health Corp. (USD) TL EXIT L+825 04/29/2025 |
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 13 bps (basis points), as of 11/02/2020
- Net positive capital flows into high-yield ETFs & mutual funds
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