European Bond Research - July 15, 2019

Posted by Corey Mahoney on Jul 15, 2019 12:11:20 PM
EUROPEAN EQUITIES REBOUND AFTER weak economic data from China reported the economy expanded at its slowest pace in 27 years in the second quarter citing trade tensions and the absence of domestic economic stimulation.  Contradicting data revealed industrial output and retail sales exceeded estimates.  Greece announced plans to issue a 7-year bond with a target of 2.5 billion euros “subject to market conditions” FTSE 100 +0.41%, German DAX +0.55%, CAC 40 +0.21%, STOXX Europe 600 +0.32%.  The 10-year Gilt dipped 4.3 basis points.  

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GERMANY FOREWARNS THE SERVICE SECTOR is slowing down following the struggling manufacturing industry.  “After what is shaping up to be a subdued development in the second quarter, the forces of economic upswing could become more prominent again if the external environment settles.”  UK house prices declined for the first time this year as the time it takes homeowners to find a buyer reaches a six-year high.  Analysts caution the fall in prices will not spark more buying, warning of a broader slowdown.  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,  ArcelorMittal SA (USD) 5.25% 8/5/2020 made some analysts' 'Conviction Buy' lists. (See the chart for ArcelorMittal SA below). Corey Mahoney (


Credit-Default Swap Market

LATEST NEWS: Top moves, sovereign tighteners (5Y): Korea 32 bp and Panama 53 bp. Sovereign wideners (5Y): China 42 bp and Netherlands 12 bp.

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New Issuance

New Issues New Issues [Continued]

(None Current 07/15/2019)



ADI Indexes

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iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 07/15/2019, 133.72 NAV as of 07/15/2019, 105.37
Daily NAV Change (%) +0.19% Daily NAV Change (%) +0.07%

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 ratecurrently 7.5% (seasonally adjusted, May2019)
  • Eurostat's quarterly GDP: 0.4% (2019 Q1)
  • 6-month Euribor: current value -0.342%, as of 07/12/2019

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

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