The Dow Jones continued to fall Thursday, dropping 122.35 points as the Federal Reserve refused to lower interest rates. Worker productivity in the U.S. is advancing at the fastest rate since 2010. Additionally, 10-year U.S. Treasury notes rose 3.6 basis points. S&P -0.21%, Dow -0.46%, NASDAQ  -0.16%.

Averages for 15 and 30-year fixed-rate mortgages have retreated a bit, after a month of steady increase. “Slightly weaker inflation and labor economic data caused mortgage rates to dip this week,” Sam Khater, Freddie Mac’s chief economist, said in a statement. For the near future, the housing market appears relatively steady. Gold fell 12.4 points amid bearish outside markets.  ADI proprietary index data showed a net yield increment for high-yield versus high-grade bonds. High-yield edged out high-grade. Among high-yield bonds showing topmost price gains at appreciable volumes traded, Pacific Gas & Electric Co. (USD) 3.75% 8/15/2042 made analysts' 'Conviction Buy' lists. (See the chart for Pacific Gas & Electric Co. below.) Andrew Robartes arobartes@advantagedata.com).

 

Key Gainers and Losers	Volume Leaders
+   Tesla Motors Inc. 5.3% 8/15/2025 Reg S + 2.2%   Sprint Corp. 7.625% 3/1/2026 + 0.4% -   US Steel Corp. 6.875% 8/15/2025 -2.1%	Teva Pharmaceutical Industries LTD   2.2% 7/21/2021 General Motors Financial Co. Inc.   2.4% 5/9/2019

Industry Returns Tracker

Industry Past Day Past Week Past Month Past Quarter YTD Past Year Agriculture, Forestry, Fishing -0.16% -0.11% 1.29% 4.32% 7.55% 7.86% Mining -0.09% -0.41% 1.46% 3.35% 9.60% 4.80% Construction 0.05% 0.10% 1.28% 4.42% 8.28% 5.82% Manufacturing -0.01% 0.08% 1.17% 3.93% 7.87% 6.64% Transportion, Communication, Electric/Gas 0.02% 0.30% 1.42% 4.70% 7.94% 7.42% Wholesale -0.00% 0.10% 1.16% 3.83% 8.18% 5.78% Retail 0.08% 0.60% 2.57% 5.40% 10.02% 8.00% Finance, Insurance, Real-Estate 0.01% 0.20% 1.21% 3.88% 7.93% 6.92% Services 0.01% 0.11% 1.01% 3.67% 8.06% 7.49% Public Administration -0.09% -0.19% 0.32% 2.55% 6.10% 10.09% Energy -0.08% -0.36% 1.61% 3.66% 9.54% 4.32%   Total returns (non-annualized) by rating, market weighted.

New Issues	Forward Calendar
1. GTCR (Ap) Finance Inc. (USD) 8% 5/15/2027 144A (05/02/2019):475MM Senior Unsecured Notes, Price at Issuance 100, Yielding 8%. 2. Teekay Corp. (USD) 9.25% 11/15/2022 144A (05/02/2019): 250MM Secured Notes, Price at Issuance 100, Yielding 9.25%.	1. Calpine Corp.: $1.4B bonds, Expected Q2 2019 2. Starwood Property Trust Inc: $300M senior notes, Expected Q2 2019

NEW ISSUANCE WATCH: on 4/29/19 participants welcome a $500MM new corporate-bond offering by
Teekay Corp.  The most recent data showed money flowed out of high-yield ETFs/mutual funds for the week ended 4/26/19, with a net outflow of $0.520B, year-to-date $13.8B flowed into high-yield.

 

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 MR14)	Road King Infrastructure LTD (5Y Sen USD CR14) Atmos Energy Corp. (5Y Sen USD MR14)

Loans and Credit Market Overview

SYNDICATED LOANS HIGHLIGHTS:

Deals recently freed for secondary trading, notable secondary activity: 

• iHeartCommunications Inc., Flexera Software Inc., JBS USA LLC, Sundyne US Purchaser

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 held below 17 bp (basis points), as of 05/02/19
• Net positive capital flows into high-yield ETFs & mutual funds 

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