JUNK BONDS GAINED AGAINST ITS INVESTMENT-GRADE counterparts in net prices linked to actual trades as appetites for risk improve.  Durable goods orders increased in January lifted by a surge in orders for commercial aircraft and commercial transportation vehicles. The 10-year U.S. Treasury note gained 0.8 basis points and the 30-year note rose 0.2 basis points.  S&P +0.78%, Dow +0.56%, NASDAQ+0.78%

BROOKFIELD ASSET MANAGEMENT IS BUYING A 62% MAJORITY STAKE in Oaktree Capital Management which will diversify Brookfield’s investments branching into distressed debt.  Brookfield Chief Executive Bruce Flatt announced, “This transaction enables us to broaden our product offering to include one of the finest credit platforms in the world, which has a value-driven investment style, consistent with ours.”  The two firms combined will have an industry-leading $475 billion in assets.Delivery of April West Texas intermediate rallied 2.73% upon U.S. supplies abruptly dipping, settling at $58.41 per barrel.   Exports from production Venezuela have stalled due to a widespread power outagewith no immediate signs of restoration. 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, L Brands Inc. (USD) 6.875% 11/1/2035 made analysts' 'Conviction Buy' lists. (See the chart for ADI indexes below) Corey Mahoney cmahoney@advantagedata.com).

 

Key Gainers and Losers	Volume Leaders
+   Midwest Connector Capital Co. LLC 4.625% 4/1/2029 144A + 0.1%   BMW US Capital LLC FLT% 4/6/2020 144A + 0.1% -   Dow Chemical Co. 5.55% 11/30/2048 144A -0.0%	BNP Paribas   VAR% 1/10/2030 144A Dow Chemical Co.   5.55% 11/30/2048 144A

Industry Returns Tracker

Industry Past Day Past Week Past Month Past Quarter YTD Past Year Agriculture, Forestry, Fishing 0.10% 0.59% 0.84% 3.23% 2.74% 4.29% Mining 0.26% 0.44% 0.83% 4.35% 3.76% 3.63% Construction 0.21% 0.72% 1.02% 3.63% 2.65% 4.19% Manufacturing 0.23% 0.52% 0.50% 3.28% 2.69% 3.40% Transportion, Communication, Electric/Gas 0.34% 0.80% 1.00% 4.25% 3.29% 4.33% Wholesale 0.17% 0.36% 0.87% 3.73% 3.68% 3.52% Retail 0.25% 0.60% 0.50% 3.36% 2.78% 3.58% Finance, Insurance, Real-Estate 0.13% 0.41% 0.69% 3.18% 2.26% 4.14% Services 0.25% 0.64% 0.57% 3.37% 2.57% 4.07% Public Administration 0.01% 0.28% 0.35% 1.77% 0.76% 3.33% Energy 0.29% 0.52% 0.98% 4.60% 3.93% 4.23%   Total returns (non-annualized) by rating, market weighted.

New Issues	New Issues [Continued]
1. Bank of America Corp. (USD) 4.33% 3/15/2050 (03/12/2019):2750MM Senior Unsecured Notes, Price at Issuance 100, Yielding 4.33%. 2. Southern California Edison Co. (USD) 4.875% 3/1/2049 (03/12/2019): 600MM Secured Notes, Price at Issuance 99.846, Yielding 4.88%.

Top Widening Credit Default Swaps (CDS)	Top Narrowing Credit Default Swaps (CDS)
Weatherford International LTD (5Y Sen USD XR14) Hertz Corp. (5Y Sen USD CR14)	San Miguel Corp. (5Y Sen USD CR14) Atmos Energy Corp. (5Y Sen USD MR14)

Loans and Credit Market Overview

Deals recently freed for secondary trading, notable secondary activity:

• MYOB LTD, Dell International, Amer Sports Corp., Orchid Orthopedic Solutions, Neustar Inc

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 16 bp (basis points), as of 03/13/19
• Net positive capital flows into high-yield ETFs & mutual funds

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