HALISTER1: EU CREDIT DAILY: Calm Returns; Bayer Bids Up, CBA Penalties

EU CREDIT DAILY: Calm Returns; Bayer Bids Up, CBA Penalties

(Bloomberg) -- After the weakness seen in credit spreads late last week and on Monday, risk assets may still be vulnerable, but there is no investor capitulation. Notwithstanding the polemic surrounding the Fed funds outlook, there is still broad assumption that central banks will continue to fuel risk appetite with ’low for longer’ rates, Bloomberg strategist Simon Ballard writes.
  • Asian/Australian credit mkts weaker overnight, but EUR equity futures point to higher open, underpinned risk assets
    • Primary mkt remains main source of liquidity; 11 deals priced yday in busiest session since May
  • Specter of Fed rate increase still looms, while focus today will be on U.K. jobs and BOE tomorrow
  • Risk Appetite Model consolidating after seeing recent rise in volatility; still sits in ’risk on’ quadrant of the chart
  • * Bloomberg Barclays Eur-Agg Corporate index closed yday at 108bps (-1bp); Bloomberg Barclays Eur HY index closed at 385bps (-4bps)
  • CDX IG closed -0.01bp at 79.67 in overnight session; iTraxx Asia Ex Japan IG currently +0.3bps at 112.07 and iTraxx Australia quoted +1.6bps at 100.12
NEWS
  • Corporate News
  • Bayer Said to Propose Higher Monsanto Offer of $129 a Share
  • Hermes Drops Mid-Term Revenue Target as Luxury Outlook Worsens
  • Richemont Forecasts 45% Decline in First-Half Operating Profit
  • Alliance Pharma Says 1H Revenue Doubled, Confident in Outlook
  • Galliford Try Says FY Profit Reaches Record, Raises Dividend
  • Cambian 1H Revenue Grew 14%, Says 2H Performing in Line
  • Lastminute.com 1H Above Its Expectations, Raises Ebitda Guidance
  • Imaginary VW Deadline Prompts Flood of Real Investor Lawsuits
  • Vodafone NZ Fined for Making False Price Representations
  • Financial News
  • Commonwealth Bank pays $180,000 in penalties after personal overdrafts breach
  • Japan Banks on Wildest Ride Since Global Crisis Before BOJ
  • Danske CEO Says Regulators Should Wait With Further Rules
  • Credit Rating News
  • S&PGR Lowers TPC Group Inc. Rtg To ’CCC+’ From ’B-’; Otlk Neg
  • Fitch Affirms Weichai Power at ’BBB’; Outlook Stable
  • India’s First Offshore Basel III AT1 Issue A Positive: Fitch
  • Other News
  • South Africa Bank That Gave Zuma Loan Says It Sticks to Criteria
  • China Seen Investing Too Much in Power Plants That Burn Coal
  • Roy Hill Iron Ore Mine Won’t Reach Capacity This Year
ANALYST VIEWS
  • A positive yield strangely spooked the market! We would think that given the difficulties in getting any semblance of decent growth and inflation back into the system, they have to be heading most likely lower (negative) again: creditmarketdaily.com
NEW ISSUES
  • ANZ New Zealand EU1b 7Y Covered MS +12
  • Axalta Coating Systems EU450m 1/2025 NC3 3.75%
  • Eaton Capital EU550m 8Y MS +65
  • Eni EU900m 8Y MS +55, EU600m 12Y MS +70
  • HSH Finanzfonds EU750m 8Y MS -2
  • KWE GBP200m 3.95% 6/2022 Tap UKT +320
  • Novartis Finance EU1.25b 7Y, EU500m 12Y Bonds
  • Novomatic EU500m 7Y MS +170
  • VF Corporation EU850m 7Y MS +57
  • Hertz Holdings EU225m 5NC2 4.25% Area, +/-0.125%
  • National Grid Gas GBP3b 4-Part Deal
  • 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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