Advantage Data High Yield Bond Market Summary

European Bond Research - May 15, 2019

Posted by Corey Mahoney on May 15, 2019 12:19:55 PM
UNICREDIT PROGRESSES FORWARD with its plans to place a bid for Germany’s Commerzbank in a deal worth an estimated 9.3 billion euros, Commerzbank shares spiked 4.7 percent. The German government will have to approve any merger given their 15 percent stake in the bank originating from a bailout in 2008. The 10-year Gilt lost 3.4 basis points. FTSE 100 +0.70%, German DAX +0.75%, CAC 40 +0.33%, STOXX Europe 600 +0.27%.

unnamed (96)


THE GERMAN AUTO INDUSTRY FEARS A 12 PERCENT DECLINE if US tariffs are imposed on European cars, in addition, the DAX could face a 6 percent downturn.   “Germany is the tail on the U.S.-China trade war… If they blow up in a trade war, Germany is probably the place that gets hits worse,” CIO Mark Phelps of AllianceBernstein.  The economy of the blocs largest nation expanded by 0.4 percent during the first quarter of 2019 despite concerns from German engineering firms regarding an uncertainty with the US and China.  ADI (Advantage Data Inc.) extensive corporate-bond index data showed a net daily yield increment for high-grade versus high-yield constituents. High-grade bonds edged out high-yield debt as of 3 PM, London time.  Among European high-grade bonds showing a concurrence of top price gains at appreciable volumes traded, Electricite De France (USD) 4.875% 1/22/2044 Reg S made some analysts' 'Conviction Buy' lists. (See the chart for Electricite De France bonds below). Corey Mahoney (cmahoney@advantagedata.com).

Sovereign-Debt Snapshot

Country Maturity (Y) Yield (%) Previous (%) Spread (bp)
Australia 10 1.711 1.731 -71.0  
Belgium  10 0.431 0.430 -199.0  
France  10 0.333 0.331 -208.8  
Germany  10 -0.067 -0.068 -248.8  
Italy  10 2.735 2.695   31.4
Japan  10 -0.051 -0.046 -247.2  
Netherlands  10 0.130 0.118 -229.1  
Portugal  10 1.136 1.152 -128.5  
Spain  10 0.971 0.989 -145.0  
Sweden  10 0.057 0.064 -236.4  
U.K.  10 1.107 1.102 -131.4  
U.S.  10 2.421 2.408 ...

Credit-Default Swap Market

LATEST NEWS: Top moves, sovereign tighteners (5Y): Ireland 32 bp and France 28 bp. Sovereign wideners (5Y): China 49 bp

unnamed - 2019-05-15T121824.156

New Issuance

New Issues New Issues [Continued]

1. Standard Chartered PLC (USD) 0% 6/4/2049 (05/14/2019): 100MM Senior Unsecured Notes, Price at Issuance 100, Yielding 0%.

2. Fidelity National Info Services Inc (EUR) 0.125% 5/21/2021 (05/14/2019): 500MM Senior Unsecured Notes, Price at Issuance 99.896, Yielding .177%.

 

ADI Indexes

unnamed (98)

DATA CHECK:
iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 05/15/2019, 131.75 NAV as of 05/15/2019, 103.06
Daily NAV Change (%) +0.12% Daily NAV Change (%) -0.02%

OVERALL EUROPEAN CREDIT MARKET:
The euro-zone economy shows signs of positive momentum, although conditions are expected to deteriorate hindered by the termination of quantitative easing, weakening credit rating quality, and uncertainty regarding the outcome of Brexit. Closely watched indicators and rates:
  • Eurostat's unemployment rate: currently 7.7% (seasonally adjusted, March 2019)
  • Eurostat's quarterly GDP: 0.4% (2019 Q1 Preliminary)
  • 6-month Euribor: current value -0.232%, as of 05/14/2019

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.

Topics: Analytics, bonds, junk bonds, bond market, corporate bonds, market analytics, New Issues, News, research, EU, market update, European


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

 

Subscribe to Email Updates

Recent Posts