HALISTER1: EU CREDIT DAILY: All Eyes on NFP; Nomura, ANZ, Goldman, BofAML

EU CREDIT DAILY: All Eyes on NFP; Nomura, ANZ, Goldman, BofAML

(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.
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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