European Bond Research - June 6, 2019

Posted by Corey Mahoney on Jun 6, 2019 12:10:24 PM
EUROZONE ECONOMY EXPANDED in the first quarter of 2019 accelerating by 0.4 percent driven predominantly by household spending.  Despite the strong performance in the first quarter, the outlook for the second quarter remains gloomy as indexes continue to trade in a vigilant fashion.  The pound slipped 0.33 percent against the euro. The 10-year Gilt lost 3.1 basis points.  FTSE 100 +0.49%, German DAX -0.36%, CAC 40 -0.34%, STOXX Europe 600 -0.07%.

unnamed - 2019-05-29T134004.067

THE AUTOMOTIVE INDUSTRY IN BRITAIN SUFFERED ANOTHER MAJOR BLOW on Thursday following Ford announcing the closure of its plant in Bridgend, south Wales next year.  In a statement, Ford's Europe President Stuart Rowley stated, “Changing customer demand and cost disadvantages, plus an absence of additional engine models for Bridgend going forward make the plant economically unsustainable in the years ahead”.  The closure of the plant will displace 1,700 jobs, in addition, the company intends to scale back operations in Germany slashing 5,000 jobs 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, WPP Finance Corp. (USD) 3.75% 9/19/2024 made some analysts' 'Conviction Buy' lists. (See the chart for WPP Finance Corp. bonds below). Corey Mahoney (

Sovereign-Debt Snapshot

Country Maturity (Y) Yield (%) Previous (%) Spread (bp)
Australia 10 1.492 1.510 -62.9  
Belgium  10 0.222 0.244 -189.9  
France  10 0.160 0.184 -196.1  
Germany  10 -0.224 -0.206 -234.5  
Italy  10 2.489 2.527   36.8
Japan  10 -0.126 -0.101 -224.6  
Netherlands  10 -0.034 -0.021 -215.5  
Portugal  10 0.679 0.723 -144.2  
Spain  10 0.639 0.663 -148.2  
Sweden  10 -0.049 -0.064 -217.0  
U.K.  10 0.866 0.902 -125.5  
U.S.  10 2.121 2.134 ...

Credit-Default Swap Market

LATEST NEWS: Top moves, sovereign tighteners (5Y): Finland 12 bp and Spain 51 bp. Sovereign wideners (5Y): Ireland 30 bp and UK 29 bp.

unnamed - 2019-06-06T120907.076

New Issuance

New Issues New Issues [Continued]

1. MMK Intl Capital Dac (USD) 4.375% 6/13/2024 Reg S (06/05/2019): 500MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.38%.

2. Euronext NV (EUR) 1.125% 6/12/2029 (06/05/2019): 500MM Senior Unsecured Notes, Price at Issuance 99.12, Yielding 1.219%.


ADI Indexes

unnamed - 2019-05-28T172049.509

iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 06/06/2019, 132.37 NAV as of 06/06/2019, 103.12
Daily NAV Change (%) +0.13%  Daily NAV Change (%) +0.11%

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 -0.254%, as of 06/05/2019

Copyright 2019 Advantage Data Inc. All Rights Reserved.

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