Halister News

(Bloomberg) -- Renewed fragility in the macroeconomic backdrop and outlook is doing little to support risk appetite, particularly in the lower-rated, higher-beta sections of the credit quality curve, Bloomberg strategist Simon Ballard writes.

• Weak macro environment driving low interest rates, and consequent search for yield vs long-term negative implications for credit quality now tilting toward the latter; that is triggering a retreat from higher-risk assets
• But volatility most evident in synthetic products
  • Structural demand for corporate credit risk still evident in cash market; EUR corporate primary market year-to-date overtook 2015 year-to-date volume
• Weak U.S., Asian equity markets and lower oil overnight suggest bias toward softer EUR credit markets at the open again
• Weakness in benchmark iTraxx credit indexes not yet having any meaningful impact on Risk Appetite Model

• CDX IG closed +0.1bps at 81.50 in overnight session; iTraxx Asia Ex Japan IG is currently -0.02bps at 143.62

NEWS

• Corporate News
• Shell 1Q Adj. Net $1.55b Beats Ests.; Div. 47c/Share
• ISS 1Q Ebitda Meets Estimates; Keeps FY Guidance
• Maersk 1Q Net Beats Est; Keeps Group FY Outlook, Raises Oil
• Adidas Decides to Sell Golf Division to Focus on Clothing
• AB InBev First-Quarter Sales Miss Estimates on Brazil
• Sainsbury FY Underlying Pretax Beats, Final Div. 8.1p
• Wendel Gets EU1.2b From St Gobain Sale, EU500m From Bonds
• Brazil Seeks $44 Billion in Suit Over Spill at BHP-Vale Mine Dam
• Siemens Quarterly Profit Beat Estimates on Power Orders
• Swedish Match 1Q Sales, Profit Beat Estimates

• Financial News
• SocGen Posts Profit Rise on Retail Unit, Plans Securities’ Cuts
• Erste First-Quarter Profit Beats Estimates on Lower Risk Costs
• HSBC Private Bank Appeals $78 Million Fine Imposed in Hong Kong

• Credit Rating News
• Woolworths Slumps to Session Low After S&P Global Ratings Cut

• Other News
• Australia’s A$500 Billion Debt Pile to Test Bond Buyer Appetite
• PBOC Opens Taps to China Policy Banks in Bid to Sharpen Stimulus

ANALYST VIEWS

• Corporates’ ability to service their debt remains the best it has ever been. And it will continue...while support from the ECB will allow the corp bond market to weather bouts of volatility: creditmarketdaily.com

NEW ISSUES

• Philip Morris EU500m 20Y MS +90
• RCI Banque EU600m 7Y MS +78
• OP Mortgage Bank EU1.25b 7Y Covered MS +4
• Orange EU750m 9Y MS +62
• LBBW EU750m Long 5Y Covered MS -4
• NRW Bank EU1b 10Y MS -2
• European IG credit pipeline here and HY credit pipeline here
• Issuers exposed to S-T rollover and interest-rate reset risk here

• NOTE: Simon Ballard is a credit strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.

--ALEXANDER KELL

(Bloomberg) -- Casino junket operator Kim Wong, who’s tagged in $81m cyber heist, turned over to Anti-Money Laundering Council on Wednesday 250m pesos representing last tranche of funds he received from two Chinese nationals linked to stolen Bangladesh funds.

• Wong issued statement
• NOTE: Wong on March 29 told lawmakers he’s willing to return as much as $14.3m Link; Wong said he was an interpreter when 1 of 2 men asked manager of Rizal Bank to open accounts where money eventually ended up; Wong said he received $4.6m as gambling funds lodged in his co. and 450m pesos as debt payment from 1 of 2 men whom he said is an associate

(Bloomberg) -- Anheuser-Busch InBev 1Q normalized Ebitda $3.46b, est. $3.74b

• 1Q normalized EPS 51c, est. 87c
• 1Q sales $9.4b, est. $9.96b
• 1Q organic vol. down 1.7%, est. down 0.3%
• 1Q organic rev. up 3.1%, est. up 6.1%
• 1Q organic normalized Ebitda up 2.5%, est. up 5.7%
• Call 3pm CET link
• Preview

• 2Q rev. EU19b vs EU18.05b; est. EU19.3b
• Profit industrial business up 28% to EU2.12b; est. EU1.92b
  • Margin 10.9% vs 9%; margin excl. severance 11.4%
• Income from cont. operations EU1.39b vs EU2b
• Net income EU1.48b vs EU3.91b; est. EU1.08b
• EPS EU1.78 vs EU4.70; est. EU1.32
• Orders up 7% to EU22.3b
• Raises slightly targeted cost savings for FY16 to EU850m-950m; saw EU800m-900m
  • Says cost savings target for FY17 unchanged at EU1b
• Still sees 2016 EPS of EU6.00-EU6.40, industrial profit margin of 10%-11%, moderate rev. growth, orders to materially exceed rev., sees book-to-bill >1
• Statement
• Call at 10:15 CET