FANNIE AND FREDDIE MAC REVISED THEIR LENDING LIMITS on multi-family mortgages to $359 billion from $339 billion in 2018. “These new multifamily caps eliminate loopholes, provide ample support for the market without crowding out private capital.” The 10-year note spiked 12.4 basis points. S&P -0.16%, DOW +0.12, NASDAQ -0.28%.

PACIFIC GAS & ELECTRIC REACHED AN $11 BILLION SETTLEMENT with insurance companies relating to the deadly wildfires representing 85 percent of the insurance claims. “PG&E is taking money out of the pockets of people whose homes and businesses it burned down and handing the money to insurance companies to buy their cooperation.” PG&E remains under pressure and scrutiny as it emerges from chapter 11 bankruptcy. ADI proprietary index data showed a net yield increment for high-grade versus high-yield 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' list (See the chart above for ADI bonds above) Corey Mahoney

 

Key Gainers and Losers	Volume Leaders
+   Bank of Nova Scotia 4.65% PERP + 0.3%   WestPac Banking Corp. 4.875% 11/19/2019 + 0.0% -   CVS Health Corp. 5.05% 3/25/2048 -1.4%	CVS Health Corp.   4.3% 3/25/2028 GE Capital Intl. Funding Co.   4.418% 11/15/2035

Industry Returns Tracker

Industry Past Day Past Week Past Month Past Quarter YTD Past Year Agriculture, Forestry, Fishing -0.14% -0.78% -0.31% 1.16% 9.27% 9.19% Mining -0.16% -1.08% -0.10% 3.74% 11.37% 10.56% Construction -0.21% -1.08% -0.51% 3.35% 8.87% 8.91% Manufacturing -0.16% -0.99% -0.04% 3.96% 10.02% 9.57% Transportion, Communication, Electric/Gas -0.23% -1.42% -0.54% 4.86% 12.67% 12.34% Wholesale -0.06% -0.72% 0.35% 3.56% 11.02% 9.82% Retail -0.20% -1.10% -0.10% 4.60% 11.26% 10.95% Finance, Insurance, Real-Estate -0.13% -0.78% -0.09% 2.81% 8.48% 9.16% Services -0.21% -1.10% -0.17% 3.68% 9.74% 10.04% Public Administration -0.05% -0.32% 0.11% 1.43% 4.45% 5.94% Energy -0.17% -1.11% -0.24% 3.72% 11.44% 10.33%   Total returns (non-annualized) by rating, market weighted.

New Issues	New Issues [Continued]
1. Kraft Heinz Co (USD) 4.875% 10/1/2049 Reg S (09/12/2019): 1500MM Senior Unsecured Notes, Price at Issuance 98.571, Yielding 4.97%. 2. Alabama Power Co. (USD) 3.45% 10/1/2049 (09/12/2019): 600MM Senior Unsecured Notes, Price at Issuance 99.665, Yielding 3.47%.

NEW ISSUANCE WATCH: on 09/13/19 participants welcome a $400M new corporate-bond offering by
Protective Life Corp. The most recent data showed a significant flow into fixed income ETFs for the month of August, with a net inflow of $14.0 billion.

 

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)	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:

• YRC Worldwide Inc., Busy Bees Group LTD, Beazer Homes USA Inc, Murphy Oil USA 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 18 bp (basis points), as of 09/13/19
• 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.