Advantage Data High Yield Bond Market Summary

High Yield Bond Research - October 9, 2019

Posted by Pierre Robert on Oct 9, 2019 5:11:19 PM
STOCK MARKETS WERE LOWER AND BOND YIELDS WERE ALSO SLIGHTLY LOWER. China trade talks seemed stalled as well.  The 10-year note up 5.2 basis points. S&P +1.16%, DOW +0.92, NASDAQ +1.28%
SIGNS OF WEAKNESS IN THE US ECONOMY CONTINUE TO TRICKLE IN. Credit card spending fell in August by 2.2% after posting a gain of 10.5% in July.  ADI proprietary index data showed a net yield increment for high-grade versus high-yield bondsHigh-grade edged out high-yield. Among high-grade bonds showing topmost price gains at appreciable volumes traded,  Alcoa Inc. (USD) 5.95% 2/1/2037 analysts' 'Conviction Buy' list (See the chart above for Alcoa Inc. bonds above.) Pierre Robert
Key Gainers and Losers Volume Leaders
+   Petrobras Global Finance BV 7.375% 1/17/2027 + 0.2%
  Southwestern Energy Co. 4.95% 1/23/2025 + 0.2%
-   Albertsons LLC 5.75% 3/15/2025 -0.3%
  Diamondback Energy Inc. 5.375% 5/31/2025 -0.2%
Petrobras Global Finance BV   7.375% 1/17/2027
Enbridge Inc.   VAR% 1/15/2077
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing -0.07% 0.60% 0.68% 2.41% 15.80% 15.52%
Mining -0.50% -1.47% -2.67% -4.37% 4.19% -1.40%
Construction -0.03% 0.03% 0.36% 2.92% 13.82% 11.24%
Manufacturing -0.11% -0.38% -0.17% 0.90% 10.62% 7.60%
Transportion, Communication, Electric/Gas -0.08% -0.19% 0.25% 2.14% 13.48% 10.25%
Wholesale -0.04% -0.19% -0.18% 0.82% 11.31% 7.73%
Retail -0.10% -0.61% -0.39% 0.86% 14.44% 10.85%
Finance, Insurance, Real-Estate -0.05% -0.19% 0.12% 2.37% 12.62% 10.30%
Services -0.08% -0.32% 0.00% 2.10% 12.15% 9.50%
Public Administration -0.13% -0.02% -0.31% 2.57% 12.74% 15.12%
Energy -0.38% -1.05% -1.84% -3.02% 5.90% 0.35%
 
Total returns (non-annualized) by rating, market weighted.

New Issues Forward Calendar

1. Scotts Miracle-Gro Co. (USD) 4.5% 10/15/2029 144A (10/08/2019): 450MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.5%.



(None Current 10/09/2019)

 

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

2. Alpha Auto Group: $225MM notes, Expected 4th Quarter 2019

Additional Commentary
NEW ISSUANCE WATCH: on 10/01/19 participants welcome a $400M new corporate-bond offering by
National CineMedia Inc. The most recent data showed a money flowed out of highyoutflow ETF/mutual funds for the week ended 9/27/2019, with a net outflow of $258 million.
Top Widening Credit Default Swaps (CDS) Top Narrowing Credit Default Swaps (CDS)
Rite Aid Corp. (5Y Sen USD MR14)
Hertz Corp. (5Y Sen USD MR14)
Ghana, Republic of (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD XR14)

Loans and Credit Market Overview
SYNDICATED LOANS HIGHLIGHTS:

Deals recently freed for secondary trading, 
notable secondary activity: 
  • Raytheon Co., Shearer's Foods Inc., Triumph Group Inc., Seagate Technology, B&G Foods Inc.
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 33 bp (basis points), as of 10/09/19
  • 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.


SIGNS OF WEAKNESS IN THE US ECONOMY CONTINUE TO TRICKLE IN. Credit card spending fell in August by 2.2% after posting a gain of 10.5% in July.  ADI proprietary index data showed a net yield increment for high-grade versus high-yield bondsHigh-grade edged out high-yield. Among high-grade bonds showing topmost price gains at appreciable volumes traded,  Alcoa Inc. (USD) 5.95% 2/1/2037 analysts' 'Conviction Buy' list (See the chart above for Alcoa Inc. bonds above.) Pierre Robert
 
Key Gainers and Losers Volume Leaders
+   Petrobras Global Finance BV 7.375% 1/17/2027 + 0.2%
  Southwestern Energy Co. 4.95% 1/23/2025 + 0.2%
-   Albertsons LLC 5.75% 3/15/2025 -0.3%
  Diamondback Energy Inc. 5.375% 5/31/2025 -0.2%
Petrobras Global Finance BV   7.375% 1/17/2027
Enbridge Inc.   VAR% 1/15/2077
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing -0.07% 0.60% 0.68% 2.41% 15.80% 15.52%
Mining -0.50% -1.47% -2.67% -4.37% 4.19% -1.40%
Construction -0.03% 0.03% 0.36% 2.92% 13.82% 11.24%
Manufacturing -0.11% -0.38% -0.17% 0.90% 10.62% 7.60%
Transportion, Communication, Electric/Gas -0.08% -0.19% 0.25% 2.14% 13.48% 10.25%
Wholesale -0.04% -0.19% -0.18% 0.82% 11.31% 7.73%
Retail -0.10% -0.61% -0.39% 0.86% 14.44% 10.85%
Finance, Insurance, Real-Estate -0.05% -0.19% 0.12% 2.37% 12.62% 10.30%
Services -0.08% -0.32% 0.00% 2.10% 12.15% 9.50%
Public Administration -0.13% -0.02% -0.31% 2.57% 12.74% 15.12%
Energy -0.38% -1.05% -1.84% -3.02% 5.90% 0.35%
 
Total returns (non-annualized) by rating, market weighted.

unnamed - 2019-10-09T170854.615

New Issues Forward Calendar

1. Scotts Miracle-Gro Co. (USD) 4.5% 10/15/2029 144A (10/08/2019): 450MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.5%.



(None Current 10/09/2019)

 

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

2. Alpha Auto Group: $225MM notes, Expected 4th Quarter 2019

Additional Commentary


NEW ISSUANCE WATCH: on 10/01/19 participants welcome a $400M new corporate-bond offering by
National CineMedia Inc. The most recent data showed a money flowed out of highyoutflow ETF/mutual funds for the week ended 9/27/2019, with a net outflow of $258 million.
 
Top Widening Credit Default Swaps (CDS) Top Narrowing Credit Default Swaps (CDS)
Rite Aid Corp. (5Y Sen USD MR14)
Hertz Corp. (5Y Sen USD MR14)
Ghana, Republic of (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD XR14)

unnamed - 2019-09-09T165353.966

Loans and Credit Market Overview


SYNDICATED LOANS HIGHLIGHTS:

Deals recently freed for secondary trading, 
notable secondary activity: 
  • Raytheon Co., Shearer's Foods Inc., Triumph Group Inc., Seagate Technology, B&G Foods Inc.
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 33 bp (basis points), as of 10/09/19
  • 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.

Topics: Investment Grade, Loans, Analytics, bonds, junk bonds, bond market, market analytics, New Issues, News, Syndicated Bonds, syndicated, research, market update


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