HALISTER1: CANADA ECO PREVIEW: Employment, Trade Data Due in 5 Minutes

CANADA ECO PREVIEW: Employment, Trade Data Due in 5 Minutes

(Bloomberg) -- Net change in employment seen at +10k in July vs -0.7k in June (forecast range -5k to +29.6k).
  • Canada’s unemployment rate seen at 6.9% in July vs 6.8% in June (forecast range 6.8% to 7%)
  • Canada’s merchandise trade deficit seen at -C$2.84b in June vs -C$3.28b in May (forecast range -C$2.2b to -C$3b)
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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UUID: 7947283

HALISTER1: U.S. ECO PREVIEW: Employment, Trade Reports Due in 5 Minutes

U.S. ECO PREVIEW: Employment, Trade Reports Due in 5 Minutes

(Bloomberg) -- Non-farm payrolls seen at +180k in July vs +287k in June (forecast range +140k to +240k); June increase was largest since last Oct.
  • “Extreme volatility” in payroll growth has heightened has Fed uncertainty; low jobless instill confidence “to some degree": Bloomberg Intelligence
    • See commentary by Bloomberg FX strategists Dennis Pettit and TJ Marta: NFP May Resolve USD Ambivalence, Drive Fedspeak
  • Average weekly hours seen unchanged at 34.4 in July (range 34.4 to 34.5)
  • Average hourly earnings est. +0.2% m/m in July vs +0.1% in June (forecast range +0.2% to +0.4%)
  • Unemployment rate seen at 4.8% in July vs 4.9% in June (forecast range 4.6% to 5%); tracks number of unemployed as percentage of labor force
    • Also today, trade balance in goods and services seen at -$43b in June vs -$41.4b in May (forecast range -$39b to - $44b)
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Topics
First Word Agriculture

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UUID: 7947283

HALISTER: Bristol-Myers Opdivo Did Not Meet Trial Primary Endpoint

Bristol-Myers Opdivo Did Not Meet Trial Primary Endpoint

(Bloomberg) -- Bristol-Myers Squibb says Opdivo did not meet trial primary endpoint of progression-free survival in patients with previously untreated advanced non-small cell lung cancer whose tumors expressed PD-L1 at ≥ 5%. Link to Statement:Link
Alert: HALISTER
Source: BFW (Bloomberg First Word)

Tickers
BMY US (Bristol-Myers Squibb Co)
4528 JP (Ono Pharmaceutical Co Ltd)

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UUID: 7947283

(2) *BRISTOL'S OPDIVO FAILS TO IMPROVE PFS IN FIRST-LINE NSCLC STUDY

*BRISTOL'S OPDIVO FAILS TO IMPROVE PFS IN FIRST-LINE NSCLC STUDY

Alerts: HALISTER, HALISTER1
Source: BN (Bloomberg News)

Tickers
BMY US (Bristol-Myers Squibb Co)
4528 JP (Ono Pharmaceutical Co Ltd)
MRK US (Merck & Co Inc)

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UUID: 7947283

HALISTER1: Vanguard Set to Add to Credit Investments ‘Opportunistically’

Vanguard Set to Add to Credit Investments ‘Opportunistically’

(Bloomberg) -- Playing the credit market “opportunistically is probably the right thing to be doing” now as there is no imminent bubble on the horizon, according to Vanguard Asset Management.
  • “We favor adding some pockets of risk in the rest of the summer as political risks are likely to stay neutral until September,” Nick Eisinger, a London-based strategist, says in phone interview. “In the short term, there is probably a good case for credit exposure.”
  • Central banks are providing large support and a lot of this is getting priced very quickly into the markets
  • QE isn’t necessarily creating a credit bubble, but it is encouraging people to move toward riskier assets
  • There could be more opportunities when the BOE actually starts corporate bond purchases; sterling credit less liquid compared with euro, USD markets; recommends better-quality names in the U.K.
  • Even as spreads are tightening in Europe, the presence of ECB is still important; sees opportunities there
  • There is a range of new risks that will start to come in 4Q including negotiations for Brexit, constitutional referendum in Italy and the presidential vote in U.S.
  • Recommends fading some risks heading into the year-end
    • Doesn’t see the risk of any imminent bubble in the market
  • NOTE: Janus Sees Credit as ‘Good Place to Be’ Despite Bubble Risk
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Nick Eisinger (Vanguard Group Inc/The)

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HALISTER1: BOE Room to Do More May Create Carney Put for GBP Credit: BofAML

BOE Room to Do More May Create Carney Put for GBP Credit: BofAML

(Bloomberg) -- The tightening trend in GBP IG spreads has further to go, particularly for the bonds eligible to be bought by the BOE under its Corporate Bond Purchase Scheme (CBPS), Deutsche Bank analyst Michal Jezek writes in client note.
  • The relatively low, explicit cap on the total amount of purchases suggests the BOE can increase the program’s size
  • The central bank’s option to scale it up if funding conditions deteriorate is likely to create a Carney put for the U.K. corporate bond market, reducing perceived risks and transforming eligible debt to lower-beta securities
  • There was greater support for purchases of corporate bonds than gilts in the MPC, which may be seen as a sign the central bank may put a greater emphasis on the CBPS than gilt purchases in the future
  • This is likely to create positive spillover effects for the ineligible GBP corporate bonds, including lower down the rating spectrum
  • NOTE: Credit is a good place to be as the presence of central banks offers a great backstop, according to Janus, while BofAML says GBP non-financial spreads may tighten to ~93bps from 138bps over next 100 days
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Michal Jezek (Deutsche Bank AG)

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HALISTER1: Janus Sees Credit as ‘Good Place to Be’ Despite Bubble Risk

Janus Sees Credit as ‘Good Place to Be’ Despite Bubble Risk

(Bloomberg) -- Credit is a good place to be as the presence of the central banks in the market offers a great backstop at the moment, according to Janus Capital Group portfolio manager Ryan Myerberg.
  • Credit is a good option compared with other markets, given its low volatility and steady returns
  • “The risk of a bubble in credit is real as spreads look stretched now,” London-based Myerberg says in an interview. “Still, the risk-reward looks more attractive in credit compared with other markets, such as government bonds, where yields are low to negative. Investors have to choose which risks are they more willing to take.”
  • Myerberg prefers U.S. credit to EU as valuations are more attractive
  • U.K. offers opportunities even though a more selective approach to individual credits is preferred given the uncertain economic outlook surrounding its economy
    • Favors both U.S. high yield and investment grade on a relative basis; cautious on high-yield fundamentals at this point in the cycle as they aren’t improving
  • Recommends a cautious approach on government bonds as any material shift to fiscal stimulus from monetary policy will see yields picking up
  • Myerberg manages portfolios in Janus’s fundamental fixed- income group, which had about $35.8b of assets under management at the end of March
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Ryan Myerberg (Janus Capital Group Inc)

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HALISTER: Duke Said to Narrow Bidders for $2 Billion Latin America Sale

Duke Said to Narrow Bidders for $2 Billion Latin America Sale

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
DUK US (Duke Energy Corp)
BAM/A CN (Brookfield Asset Management Inc)
CJSXGZ CH (China Three Gorges Corp)
ENGI FP (Engie SA)

People
Lynn Good (Duke Energy Corp)
Xi Jinping (People's Republic of China)

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HALISTER1: Buy JPY 10Y Payers vs Selling 2Y Payers on Bear-Steepening: SG

Buy JPY 10Y Payers vs Selling 2Y Payers on Bear-Steepening: SG

(Bloomberg) -- JPY rate volatility market is skeptical about the bear-steepening or bull-flattening potential of the JPY 2s10s curve, and that offers attractive levels to position for these scenarios, Societe Generale strategist Adam Kurpiel writes in client note.
  • JPY short rates vol is trading well above its historical average and very close to long rates vol
  • Shift of policy mix towards fiscal easing, with persistently accommodative monetary policy, is consistent with a bear- steepening of the yield curve
  • Buy JPY 3m10y payers ATMF, sell 3m2y payers ATMF; PV01- weighted, close to zero-cost
  • Strategy would generate profits at expiry if higher JPY 10y rate drives the JPY 2s10s curve steeper
  • If JPY rates decrease from current levels, both options would expire OTM and the loss on the trade would be limited to the close-to-zero premium paid at inception
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Adam Kurpiel (Societe Generale SA)

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