Halister News

--MICHAEL PATTERSON

(Bloomberg) -- Medium to long term bearish trades in USD 10y IRS have reached fairly attractive entry levels, writes Commerzbank strategist Markus Koch, in a client note.

• To express a modestly bearish scenario over long term, while avoiding adverse PnL effects from a contrary bullish outcome, recommend buying USD 1y10y ATM vs selling USD 1y10y OTM payers
• Trade would expire worthless in a bullish environment while offers scaling into bearish USD exposure at zero cost

(To subscribe to EU Credit Daily, click here and set alert via ‘"Display & Edit’’) By Simon Ballard (Bloomberg) -- European cash credit spreads continue their attempt to retrace tighter from the mid-February wides, but the contrasting volatile price action in iTraxx indexes highlights the underlying investor caution, Bloomberg strategist Simon Ballard writes.

• Today’s focus likely on U.S. jobs report due 13:30 GMT, the next macro data point for investors to gauge direction of Fed interest-rate policy
  • Risk assets may weaken on a strong NFP number (>200k) if perceived to strengthen Fed hand for tightening again at March 16 FOMC
• BHP Billiton cut 2 notches Thursday by Moody’s to the cusp of BBB territory, and left on negative outlook; reflects impact of recent commodity rout and clear need for fundamental credit analysis in investment strategy
• Risk Appetite model clearly highlights extent of recent risk asset price volatility

• CDX IG currently -2.2bps at 98.11 in overnight session; iTraxx Asia Ex Japan IG is currently -3.4bps at 149.32

NEWS

• Corporate News
• Cathay Pacific Seen Posting Wider Hedging Loss as Oil Drops
• Microsoft, Google Join Rivals to Back Apple in FBI Fight
• Brunel 2015 Rev. In Line; Strong 4Q in Europe, Oil & Gas Down

• Financial News
• Nomura, UOB Said to Weigh Offers for Barclays’s Asia Wealth Unit
• Edmond de Rothschild Targeted by French Criminal Probe
• Australian Regulator Starts Civil Proceedings Vs ANZ Over BBSW

• Rating News
• Asia USD Bond Sales Slow Amid Moody’s China Outlook Cut
• Fitch Affirms LG Electronics at ’BBB-’; Outlook Stable

• Other News
• Goldman, BofA Dismiss Traders After Getting Taste of ’16 Markets
• Oil Set for 3rd Weekly Gain as Producers Plan to Meet on Freeze

ANALYST VIEWS

• With investor positioning cleaner but option markets still implying an expectation of choppiness ahead, like to sell strangles on Main where breakevens (seem) attractive; also recommend an opportunistic bullish risk-reversal on Main with March expiry to position for any upside surprises from the ECB: Barclays
• There was a time, not so long ago, that we had over EU120bn of IG non-financial supply in the first quarter of the year; (2016 YTD) we are at EU37bn, (with) almost half the supply from just four borrowers: creditmarketdaily.com

NEW ISSUES

• Covestro EU1.5b 3-Part Deal
• Bankia EU1B 7Y Covered MS +82
• Montenegro EU300m 5Y Bonds 6% Yield
• BT EU3.9b Three-Part Deal
• Coca-Cola HBC EU600m 11/2024 MS +150
• CIBC GBP250m 3Y Covered FRN 3mL +52
• Rentenbank $250m 1.625% 8/2020 Tap MS +35
• Helaba EU1B 4Y MS +55
• BNS EU750M 7Y Covered MS +27
• 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.

(Bloomberg) -- License is revoked for high-risk lending policy without adequate provisioning, violation of anti-money laundering legislation, Bank of Russia says in statement on website.

• Rosavtobank was #254 by assets of Feb. 1
• NOTE: Link to statement (in Russian)