EU CREDIT DAILY: Challenges Remain; Carrefour, VW, Spanish banks
(Bloomberg) -- Though there were no surprises from the BOE yesterday, weakness in banks’ 1Q trading revenues and their susceptibility to macroeconomic volatility highlight the challenges on the firmament, Bloomberg strategist Simon Ballard writes.
- General outlook for risk remains robust though, subject to continued optimism over China macroeconomic outlook and correctly priced/structured primary issuance
- Low corporate default-rate environment continues to support investment case in quality bonds, even as long- term macro and hawkish rate concerns may damp appetite for higher-yielding, lower-quality paper
- Beware also of resurgent threat to sentiment from Greece as IMF suggests €86b 2015 bailout deal may already be unsustainable; could spur renewed uncertainty, risk aversion
- For now though, spread dispersion continues to be whittled away within the Risk Appetite Model
- CDX IG currently +0.9bps at 79.04 in overnight session; iTraxx Asia Ex Japan IG is currently -0.8bps at 138.74
NEWS
- Corporate News
- Carrefour Reports Higher First-Quarter Sales, Buoyed by Brazil
- Volkswagen Europe Market Share Hits Five-Year Low Amid Scandal
- Infosys 4th-Quarter Net Income Beats Analysts Estimates
- San Miguel Says 2015 Net Fell to 12.4b Pesos Vs 15.1b Pesos Y/y
- Atlas Mining Posts 814m Peso Loss in 2015 on Low Copper Prices
- Tencent Said in Talks for Syndicated Loan of Up to $2 Billion
- Financial News
- Goldman’s Blankfein Said to Demand Deepest Cost Cuts in Years
- Vietnam’s Eximbank Plans 2016 Pretax Profit at 720b Dong
- Wells Fargo Adds 100 Credit Suisse Brokers in Recruitment Deal
- Spain’s Banks Drawn Back to Homebuilder Loans as Sales Surge
- Credit Rating News
- Moody’s affirms Maybank’s (P)A3 Senior Unsecured MTN rating and assigns (P)Baa2 Subordinate MTN rating
- GPT Group Rtgs Raised to ‘A/A-1’ by S&P; Outlook Stable
- Fitch Affirms Nordstrom, Inc.’s IDR at ’BBB+’; Outlook Stable
- S&P Raises Cliffs Natural Resources Rtg To ’CCC+’; Outlook Neg
- Fitch Affirms Muni Ratings Tied to ’AAA’ U.S. Sovereign Ratings
- Other News
- Bonds Snubbed by Draghi Outperform as ECB Eyes Corporate Debt
ANALYST VIEWS
- We would like to think syndicates will finally realize that ratcheting deals 20 bps or so tighter versus those initial indications has run it course. Investors need to feel the love that comes with deals breaking tighter: creditmarketdaily.com
NEW ISSUES
- Arrow Global EU230m 7NC3 Senior Secured FRN E +475
- Iberdrola EU1b 10Y Green Bond MS +63
- John Deere Bank EU250m 4Y FRN 3mE +35
- Leeds BS EU500m 4Y Covered Bonds MS +27
- L-Bank $2b 2Y Reg S Bonds MS +22
- Merlin Properties EU850m 7Y MS +200
- Yorkshire BS GBP400m 10Y UKT +210
- 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.
Alert:
HALISTER1Source: BFW (Bloomberg First Word)
Tickers CA FP (Carrefour SA)
To de-activate this alert, click
hereUUID: 7947283