Investment Grade Bond Research - October 24, 2019

Posted by Pierre Robert on Oct 24, 2019 5:22:47 PM

US STOCKS WERE MIXED TODAY, and Boris Johnson called for snap elections in December.  Republicans and Democrats fight over the close door setting of the Impeachment inquiry. The 10-year Treasury note declined 0.7 bps. S&P -0.36%, DOW -0.10%, NASDAQ -0.72%.

SOVEREIGN BONDS WERE COLLECTIVELY DOWN. Talk of negative yields are returing. 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, Anheuser Busch Companies Inc (USD) 5.95% 1/15/2033 made analysts' 'Conviction Buy' list. (See the chart above for Anheuser Busch Companies Inc below) Pierre Robert
Key Gainers and Losers Volume Leaders
+   CVS Health Corp. 5.05% 3/25/2048 + 0.3%
  Enbridge Inc. 1.75% 1/10/2020 + 0.0%
-   Wells Fargo & Co. 4.15% 1/24/2029 -0.3%
  Cardinal Health Inc. 2.616% 6/15/2022 -0.1%
Wells Fargo & Co.   4.15% 1/24/2029
Marvell Technology Group LTD   4.2% 6/22/2023
Industry Returns Tracker
Industry Past Day Past Week Past Month Past Quarter YTD Past Year
Agriculture, Forestry, Fishing 0.17% 0.28% 0.56% 1.15% 5.60% 6.49%
Mining 0.03% 0.14% -0.45% 2.42% 12.02% 12.31%
Construction 0.10% 0.07% 0.28% 2.57% 9.83% 10.98%
Manufacturing 0.01% 0.17% 0.18% 2.93% 10.66% 11.54%
Transportion, Communication, Electric/Gas 0.08% 0.24% 0.05% 3.56% 13.74% 15.30%
Wholesale 0.06% 0.29% 0.37% 2.79% 11.90% 12.06%
Retail 0.03% 0.28% 0.20% 3.49% 12.25% 13.35%
Finance, Insurance, Real-Estate 0.04% 0.18% 0.30% 2.39% 9.53% 10.72%
Services 0.00% 0.18% 0.33% 3.10% 10.91% 12.52%
Public Administration 0.02% -0.03% 0.20% 1.54% 4.88% 6.98%
Energy 0.05% 0.18% -0.43% 2.40% 12.35% 12.52%
Total returns (non-annualized) by rating, market weighted.
New Issues New Issues [Continued]

(None Current 10/24/2019)



Additional Commentary

NEW ISSUANCE WATCH: on 10/21/19 participants welcome a $750MM new corporate-bond offering by 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 MR14)
Weatherford International LTD (5Y Sen USD XR14)
Ghana, Republic of (5Y Sen USD CR14)
SuperValu Inc. (5Y Sen USD MR14)

unnamed - 2019-09-09T165404.526

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 28 bp (basis points), as of 10/23/19
  • Net positive capital flows into high-yield ETFs & mutual funds

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

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