European Bond Research - October 3, 2019

Posted by Pierre Robert on Oct 3, 2019 11:32:58 AM
TERRIBLE MANUFACTURING DATA drove Germany's stocks lower. Brexit calamity and Boris Johnson's renewed determination to leave Europe has knocked the FTSE lower. FTSE 100 -1.37%, German DAX -2.75%, CAC 40 +0.46%, STOXX Europe 600 -0.13%. The 10-year Gilt was down 4.5 bps.

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SOVEREIGN BONDS IN THE EU AND US are slightly mixed to noticeably lower. Trade tensions and political tensions are hitting bonds and stocks worldwide.  (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,  Actavis Funding SCS (USD) 4.75% 3/15/2045 made some analysts 'Conviction buy' lists. (See the chart for Actavis Funding SCS 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. Celtic Resources Hldg Designated Activity Company (USD) 4.125% 10/9/2024 144A (10/02/2019): 400MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.13%.

2. BPCE SA (USD) 2.7% 10/1/2029 Reg S (10/02/2019): 150MM Senior Preferred Security, Price at Issuance 100.166, Yielding 2.68%.


ADI Indexes

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iShares Core EUR UCITS iShares Euro High Yield UCITS
NAV as of 10/03/2019, 134.82 NAV as of 10/03/2019, 102.85
Daily NAV Change (%)+0.13% Daily NAV Change (%) -0.24%

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 -0.384%, as of 10/02/2019

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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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