Halister News

(Bloomberg) -- Telecoms sector likely to be in focus today following AT&T’s acquisition of Time Warner, but any positive credit market reaction to the takeover may be damped by concerns over possible regulatory obstacles, Bloomberg strategist Simon Ballard writes.

• Asian equities and credit markets edging stronger overnight after fragile opening; suggests firm tone to EUR risk assets later
• A big week for 3Q corporate earnings; key results include Apple (Tuesday), Alphabet, Amazon and Twitter (Thursday)
• Politics set to drive near-term risk asset sentiment as U.S. election campaign enters last 2 weeks and Brexit polemic intensifies; global credit risk remains susceptible to headline risk

• Risk Appetite Model shows recent volatility & spread dispersion as things of the past
• Bloomberg Barclays Eur-Agg Corporate index closed Friday at 111bps (unchanged); Bloomberg Barclays Eur HY index closed at 370bps (-4bps)
• CDX IG closed +0.4bps at 74.25; iTraxx Asia Ex Japan IG is currently -0.5bps at 115.73 and iTraxx Australia quoted -0.6bps at 103.37

NEWS

• Corporate News
• Philips Third-Quarter Profit Rises as Personal Health Gains
• Famous Brands 1H Profit Climbs; Scraps Dividend on High Gearing
• Earnings Speculation Dominates Japan Stocks as Nintendo Slides
• AGL Energy Aims to Sell $500 Million of Assets, CEO Vesey Says
• Cobham Trading in 3Q Challenging, FY Below Expectations

• Financial News
• TD Ameritrade, TD Bank Said Near $4 Billion Scottrade Deal
• Dubai Islamic Bank Quarterly Profit Drops 9.9%; Misses Estimates

• Rating News
• Moody’s changes outlook on Russia’s banking system to stable from negative
• Fitch Affirms China State Construction Engineering at ‘A’/Stable
• S&PGR Affirms JPMorgan Australia Ltd. ‘A+/A-1’ Ratings
• Number of Defaults in Greater China Rose in 2015. S&P Study Says
• Fitch Affirms SK Telecom, SK Broadband at ‘A-’; Outlook Stable

• Other News
• BOJ Warns Banks May Take Excessive Risks to Stay Profitable
• EU Eyes Tailoring Global Capital Rules to Spare Struggling Banks
• China Tackles Bad Debt by Allowing More Asset Firms, News Says
• Carney’s BOE Future Gives Investors Yet More Brexit Uncertainty

ANALYST VIEWS

• A Clinton presidency would generally mean continuity, limiting shocks to markets. Though continuity of policy may prove good for equities in general, Clinton’s regulatory intentions could prove problematic for some sectors, including shadow banking, fracking and trade: Roubini
• It’s NOT because of the ECB’s QE corporate bond purchases that issuance (net) in September may have picked up - as suggested was the case by Mario Draghi. To us, it is complete coincidence: creditmarketdaily.com

NEW ISSUES

• Credit Agricole SCF EU500m 10Y Covered Bond MS -7
• Inmobiliaria Colonial EU600m 8Y MS +135
• 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.