BRITISH WAGES GREW AT THE FASTEST RATE in nearly 11 years rising by 3.6 percent on an annual basis as unemployment remains at its lowest level since 1975. “As more and more people have entered work, businesses have found it harder to fill vacancies, and skills shortages are now clearly evident across all sectors.” Economists suspect the labor market to lose momentum as the new Brexit deadline of October 31st approaches and employers become cautious potentially incurring layoffs. 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, Altice Financing SA (USD) 7.5% 5/15/2026 Reg S made some analysts' 'Conviction Buy' lists. (See the chart for Altice Financing SA below). Corey Mahoney (cmahoney@
Credit-Default Swap Market
|New Issues||New Issues [Continued]|
1. GELF Bond Issuer I (EUR) 1.125% 7/18/2029 (07/15/2019):400MM Senior Unsecured Notes, Price at Issuance 99.475, Yielding 1.181%.
2. LB Baden-Wuerttemberg (EUR) 0.5% 7/16/2026 (07/15/2019):100MM Senior Non Preferred Notes, Price at Issuance 100.433.
|iShares Core EUR UCITS||iShares Euro High Yield UCITS|
|NAV as of 07/16/2019, 133.87||NAV as of 07/16/2019, 105.30|
|Daily NAV Change (%) +0.16%||Daily NAV Change (%) -0.07%|
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 7.5% (seasonally adjusted, May 2019)
- Eurostat's quarterly GDP: 0.4% (2019 Q1)
- 6-month Euribor: current value -0.343%, as of 07/15/2019
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