ALTRIA BONDS SPIKE following confirmed merger talks with Phillip Morris discussing an all-stock merger reuniting the two companies. “With disruption facing the world of tobacco, we can see some merit in a re-merger.” Gold advanced 0.92 percent closing at $1551.3 per ounce. The 10-year note lost 5.5 basis points. S&P -0.18%, DOW -0.31, NASDAQ -0.22%.
U.S. HOME PRICES DECELERATED for the fifteenth straight month posting a 3.1 percent year-over-year gain down from 3.3 percent in May. “Home price gains continue to trend down, but maybe leveling off to a sustainable level.” Despite lower mortgage rates buyers have not been enticed enough to move the pendulum. ADI proprietary index data showed a net yield increment for high-grade versus high-yield bonds. High-grade edged out high-yield. Among high-grade bonds showing topmost price gains at appreciable volumes traded, Altria Group Inc. (USD) 3.875% 9/16/2046 made analysts' 'Conviction Buy' list. (See the chart below for Altria Group bonds below.) Corey Mahoney
| Key Gainers and Losers |
Volume Leaders |
| + |
United States STL Corp. New 6.25% 3/15/2026 |
+ 2.3% |
| |
Frontier Communications Corp. 11% 9/15/2025 |
+ 2.1% |
| - |
Teva Pharmaceutical Industries LTD 2.8% 7/21/2023 |
-0.0% |
|
Petrobras Global Finance BV 6.85% 6/5/2115
Frontier Communications Corp. 11% 9/15/2025
|
| Industry Returns Tracker |
| Industry |
Past Day |
Past Week |
Past Month |
Past Quarter |
YTD |
Past Year |
| Agriculture, Forestry, Fishing |
0.01% |
0.25% |
0.50% |
6.74% |
12.71% |
13.48% |
| Mining |
-0.05% |
0.76% |
-3.25% |
-3.68% |
4.63% |
-0.72% |
| Construction |
0.01% |
0.22% |
1.11% |
4.77% |
12.89% |
9.71% |
| Manufacturing |
0.02% |
0.46% |
0.46% |
2.73% |
10.25% |
7.34% |
| Transportion, Communication, Electric/Gas |
0.05% |
0.34% |
0.47% |
4.18% |
12.34% |
8.84% |
| Wholesale |
-0.01% |
0.15% |
-0.25% |
2.65% |
10.56% |
6.79% |
| Retail |
0.01% |
0.12% |
-0.43% |
2.87% |
13.02% |
9.48% |
| Finance, Insurance, Real-Estate |
0.00% |
0.31% |
0.65% |
3.84% |
11.79% |
9.65% |
| Services |
0.04% |
0.44% |
0.68% |
3.31% |
11.35% |
8.74% |
| Public Administration |
-0.28% |
-0.17% |
1.13% |
4.72% |
12.53% |
15.10% |
| Energy |
-0.00% |
1.03% |
-1.74% |
-1.78% |
6.90% |
1.57% |
| |
| Total returns (non-annualized) by rating, market weighted. |
|
| New Issues |
Forward Calendar |
|
(None Current 08/27/2019)
|
1. Sinclair Broadcast Group Inc.: $2.55B, seven-year senior secured notes; $2.325B eight year senior unsecured notes
2. General Electric Distributed Power: $600M high-yield bonds, Expected Q3 2019
|
Additional Commentary
NEW ISSUANCE WATCH: on 08/26/19 participants welcome a $750M new corporate-bond offering by
Texas Instruments Inc. The most recent data showed money flowed out of high-yield ETFs/mutual funds for the week ended 8/16/19, with a net outflow of $4.07B.
| Top Widening Credit Default Swaps (CDS) |
Top Narrowing Credit Default Swaps (CDS) |
Weatherford International LTD (5Y Sen USD XR14)
Hertz Corp. (5Y Sen USD XR14) |
Cable & Wireless Communication (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD MR14) |
Loans and Credit Market Overview
SYNDICATED LOANS HIGHLIGHTS:
Deals recently freed for secondary trading, notable secondary activity:
- PaySimple Inc., Nike Inc., 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 19 bp (basis points), as of 08/27/19
- Net positive capital flows into high-yield ETFs & mutual funds
Copyright 2019 Advantage Data Inc. All Rights Reserved. http://www.advantagedata.com
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.
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