High Yield Bond Research - August 20, 2019

Posted by Andrew Robartes on Aug 20, 2019 5:24:32 PM
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US STOCKS FELL TODAY as investors continue to weigh concerns over the strength of the economy. Today’s drop comes after three straight days of growth. The 10-year Treasury note fell 5.6 basis points to 1.553%. S&P -0.79%, DOW -0.66%, NASDAQ -0.68%.
IN THE CORPORATE BOND SPACE, Roper Technologies, Inc. recently priced $1.2 billion worth of senior unsecured notes. The bonds are available in two separate tranches, yielding 2.35% and 2.95%. The tech company intends to use the proceeds for general corporate purposes and acquisitions. ADI proprietary index data showed a net yield increment for high-grade versus high-yield bondsHigh-grade edged out high-yield. Among high-grade bonds showing topmost price gains at appreciable volumes traded, San Diego Gas & Electric Company (USD) 5.35% 5/15/2035 made analysts' 'Conviction Buy' list. (See the chart for ADI Indices above) Andrew Robartes
Key Gainers and Losers Volume Leaders
+   Teva Pharmaceutical Industries LTD 4.1% 10/1/2046 + 4.5%
  RR Donnelley & Sons Co. 7.875% 3/15/2021 + 0.5%
  MGM Resorts Intl 7.75% 3/15/2022 + 0.3%
-   Petrobras Global Finance BV 7.375% 1/17/2027 -1.9%
  Petrobras Global Finance BV 8.75% 5/23/2026 -0.6%
Teva Pharmaceutical Industries LTD   4.1% 10/1/2046
RR Donnelley & Sons Co.   7.875% 3/15/2021
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing 0.06% -0.31% -0.14% 6.72% 12.37% 13.05%
Mining 0.21% -0.81% -3.66% -5.55% 3.48% -1.69%
Construction 0.15% 0.37% 1.05% 4.08% 12.56% 9.65%
Manufacturing 0.11% 0.03% 0.11% 1.71% 9.06% 6.67%
Transportion, Communication, Electric/Gas 0.08% 0.29% 1.13% 4.21% 12.04% 9.63%
Wholesale 0.14% -0.08% -0.16% 2.10% 10.70% 6.80%
Retail 0.07% 0.13% 0.21% 2.40% 12.74% 9.49%
Finance, Insurance, Real-Estate 0.07% 0.13% 0.85% 3.77% 11.67% 9.69%
Services 0.15% 0.11% 0.47% 2.77% 10.45% 8.27%
Public Administration 0.32% 0.52% 2.26% 5.36% 12.73% 15.21%
Energy 0.13% -0.65% -3.23% -4.45% 4.45% -0.45%
Total returns (non-annualized) by rating, market weighted.

unnamed - 2019-08-20T172244.801

New Issues Forward Calendar

(None Current 08/20/2019)


1. Sinclair Broadcast Group Inc.: $2.55B, seven-year senior secured notes; $2.325B eight year senior unsecured notes

2. Calpine Corp.: $1.4B bonds, Expected Q3 2019

Additional Commentary

NEW ISSUANCE WATCH: on 08/13/19 participants welcome a $2.1B new corporate-bond offering by
Tenet Healthcare Corp. The most recent data showed money flowed out of high-yield ETFs/mutual funds for the week ended 8/9/19, with a net outflow of  since October 2018.
Top Widening Credit Default Swaps (CDS) Top Narrowing Credit Default Swaps (CDS)
Rite Aid Corp. (5Y Sen USD MR14)
Weatherford International LTD (5Y Sen USD XR14)
Hovnanian Enterprises Inc. (5Y Sen USD MR14)
Ghana, Republic of (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD MR14)

unnamed - 2019-08-01T153117.188

Loans and Credit Market Overview


Deals recently freed for secondary trading, 
notable secondary activity: 
  • US Foods Inc., Duerre Group, Albertsons LLC, Helical PLC
OVERALL CREDIT MARKET:Long-term bond yields are expected to hit a cyclical peak in 2019 given tight fiscal policy and lagging global economies. Europe remains checked by stubbornly low inflationary forces.  Positive effects remained in force:
  • TED spread was 26 bp (basis points), as of 08/20/19
  • Net positive capital flows into high-yield ETFs & mutual funds 

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

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