US STOCKS FELL SLIGHTLY TODAY amid European headlines regarding Brexit. Additionally, McDonald’s missed earnings expectations in a mixed third quarter and saw shares dip 5%. The 10-year Treasury note declined 3.7 bps. S&P -0.36%, DOW -0.15%, NASDAQ -0.72%
IN THE CORPORATE BOND SPACE, Netflix, Inc. (NFLX) priced $2 billion worth of senior unsecured notes due in 2030. The American streaming service will use the proceeds from these junk-rated bonds to finance new content, and potential acquisitions. 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, Ford Motor Co. (USD) 4.346% 12/8/2026 made analysts' 'Conviction Buy' list. (See the chart above for Ford Motor Co. below) Andrew Robartes
|Key Gainers and Losers||Volume Leaders|
|Molson Coors Brewing Co. 4.2% 7/15/2046
Southern Copper Corp. 3.875% 4/23/2025
|Industry Returns Tracker|
|New Issues||New Issues [Continued]|
1. Royal Bank of Canada (USD) 2.25% 11/1/2024 (10/21/2019): 1500MM Senior Unsecured Notes, Price at Issuance 99.778, Yielding 2.3%.
2. Delta Airlines (USD) 3.75% 10/28/2029 (10/21/2019): 600MM Senior Unsecured Notes, Price at Issuance 99.595, Yielding 3.8%.
United Rentals Inc. The most recent data showed a money flowed out of highyoutflow ETF/mutual funds for the week ended 9/27/2019, with a net outflow of $258 million.
|Top Widening Credit Default Swaps (CDS)||Top Narrowing Credit Default Swaps (CDS)|
|Rite Aid Corp. (5Y Sen USD XR14)
Weatherford International LTD (5Y Sen USD MR14)
|Cable & Wireless Communication (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD MR14)
Loans and Credit Market Overview
Deals recently freed for secondary trading, notable secondary activity:
- McDermott International Inc., Live Nation Entertainment Inc., Berry Plastics Corp.
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 28bp (basis points), as of 10/22/19
- 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.