European Bond Research - October 2, 2019

Posted by Pierre Robert on Oct 2, 2019 12:07:58 PM
TERRIBLE MANUFACTURING INDEX DATA KNOCKED STOCKS down big time! Slow down was a terrible blow to global growth. FTSE 100 -2.53%, German DAX  -1.85%, CAC 40 -2.22%, STOXX Europe 600 -2.06%. The 10-year Gilt was up 4.9 bps.

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BORIS JOHNSON'S NO DEAL BREXIT SEEMS TOTALLY DEAD. He stated that there will be no checks in Ireland and he sent Junker a deal proposal. (Advantage Data Inc.).  Extensive corporate-bond index data showed a net daily grade 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,  Phoenix Group Hldgs (USD) 5.375% 7/6/2027 made some analysts 'Conviction buy' lists. (See the chart for Phoenix Group Hldgs bonds below). Pierre Robert


Credit-Default Swap Market

LATEST NEWS: Top moves, sovereign tighteners (5Y): Finland 11.32 bp and Germany 10.13 bp. Sovereign wideners (5Y): Denmark 10.525 bp and Ireland 32.68  bp.

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New Issuance

New Issues New Issues [Continued]

1. Diageo Capital PLC (USD) 2.125% 10/24/2024 (10/01/2019): 600MM Senior Unsecured Notes, Price at Issuance 99.971, Yielding 2.13%.

2. Royal Mail Group LTD (EUR) 1.25% 10/8/2026 (10/01/2019): 550MM Senior Unsecured Notes, Price at Issuance 99.794, Yielding 1.281%.


ADI Indexes

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iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 10/02/2019, 134.56 NAV as of 10/02/2019, 103.19
Daily NAV Change (%)-0.29%% Daily NAV Change (%) -0.28%

The euro-zone economy shows signs of negative momentum, weakening credit rating quality, and uncertainty regarding the outcome of Brexit. Closely watched indicators and rates:
  • Eurostat's unemployment ratecurrently 7.5% (seasonally adjusted, May 2019)
  • Eurostat's quarterly GDP: 0.4% (2019 Q1)
  • 6-month Euribor: current value -0.387%, as of 10/01/2019

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

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