HALISTER1: Better Relative Value in Structured Products vs Corps: Wells

Better Relative Value in Structured Products vs Corps: Wells

(Bloomberg) -- Credit-oriented structured products continue to offer lower spread volatility, and, in some cases, wider spreads than corporate bond alternatives, Wells Fargo analysts Marielle Jan de Beur and Gary Zhu write in research note.
  • “We continue to see better relative value in structured products vs. corporate bond alternatives”
    • Spread levels remain attractive, which bodes well for near-term outperformance of the sector
  • In terms of spread tightening, CMBS outperformed other comparably rated securities in July
    • Increased spread tightening in non-agency CMBS likely prompted some profit-taking in the latter half of July
  • Spreads on floating-rate assets tightened across the board in July
    • Subordinated assets outperformed AAA bonds
  • In July, ABS, CLOs and CMBS investors were net buying in below-investment-grade securities, while reducing IG exposures
    • Investors’ net selling in below-IG RMBS exceeded the net purchases for the first time this yr as dealers digested secondary supply
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Gary Zhu (Wells Fargo & Co)
Marielle Jandebeur (Wells Fargo & Co)

Topics
Key Comm. Real Estate News

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UUID: 7947283

HALISTER1: Brazil, Federative Republic of - Rating Report

Brazil, Federative Republic of - Rating Report

Alert: HALISTER1
Source: DBR (Dominion Bond Rating Service)

Tickers
1323Z BZ (Federative Republic of Brazil)

People
Fergus McCormick (DBRS Inc)
Michael Heydt (DBRS Inc)

Topics
Fixed Income Research
Prov., Reg. Credit Research
Credit Analysis Research
Credit Research
Investment Research

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UUID: 7947283

HALISTER: Oil Retreats to Bear Market as Global Supply Glut Seen Growing

Oil Retreats to Bear Market as Global Supply Glut Seen Growing

Alert: HALISTER
Source: BN (Bloomberg News)

Tickers
XOM US (Exxon Mobil Corp)
RDSA LN (Royal Dutch Shell PLC)

People
Gene McGillian (Tradition Energy)
Robert Yawger (Mizuho Financial Group Inc)
William O'Grady (Confluence Investment Management LLC)

Topics
Energy and Commodity Markets

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UUID: 7947283

HALISTER1: Fed to Hike Once in 2016, Consensus Is Too Low: Renaissance

Fed to Hike Once in 2016, Consensus Is Too Low: Renaissance

(Bloomberg) -- “Though the market has moved further away from a rate hike in 2016, our confidence in one has gone up in the last week,” Renaissance Macro Research economist Neil Dutta writes in note.
  • Inventory rebuilding should support 2H growth; output gap “looks closed,” which would lead to increasing pressure on core inflation; USD appears to have stabilized, policy divergence looks priced into USD
  • Global growth could be expanding above trend; downside risks appear to be easing
  • Flat forward curve looks “a little too flat”
    • “Consensus may be underestimating the risk of an upside surprise to growth”
    • Renaissance expects Fed to hike in Dec.
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Neil Dutta (Renaissance MacRo Research LLC)

Topics
BGOV Finance

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UUID: 7947283