Halister News

(Bloomberg) -- While global markets are currently focusing on expectations for Sept. 21 Fed rate decision, this is also a big week for U.K. data. Inflation numbers due this morning will set the scene ahead of Thursday’s BOE meeting, Bloomberg strategist Simon Ballard writes.

• Markets found some stability overnight after Fed Governor Brainard advocated a wait-and-see approach to policy; WIRP now shows 22% rate-rise probability for Sept. FOMC
  • Credit markets are still susceptible to headline risk but after the latest selloff, wider corporate bond spreads may now encourage some investors to look for buying opportunities
• Robust Chinese data should also underpin near-term EUR risk sentiment; China Aug. industrial production +6.3%, retail sales +10.6%
• Risk Appetite Model registers spike in volatility (10.7% to 18.7%) on back of rates selloff, but closes off the session wides
  • Bloomberg Barclays Eur-Agg Corporate index closed yday at 109bps (+2bps); Bloomberg Barclays Eur HY index closed at 389bps (+22bps)
• CDX IG closed -2.9bps at 76.73 in overnight session; iTraxx Asia Ex Japan IG currently -0.4bps at 109.63 and iTraxx Australia quoted -1.8bps at 98.52

NEWS

• Corporate News
• JD Sports Fashion 1H Pretax Up, Positive 2H Trading Encouraging
• Ocado 3Q Retail Gross Sales Meet Estimates
• Manx Telecom Says Trading In Line With Board Expectations
• Ikea Group FY Sales Rises 7.1%; Plans First India, Serbia Stores
• Ahlstrom Raises Profitability Outlook, Narrows Sales Forecast
• Boeing Boosts China Plane Demand Outlook as Middle Class Grows
• Air Liquide Seeks EU3.3b in Rights Offer for Airgas Purchase
• GIP to Acquire $4.3 Billion Stake in Spain’s Gas Natural Utility
• Vedanta Wins Cairn Nod for BHP-Style Resources Conglomerate

• Financial News
• China’s Postal Savings Bank Seeks Up to $8.1 Billion in IPO
• BNY Mellon Names David Cruikshank as Asia Pacific Chairman
• CYBG See ‘Double-Digit’ Return on Tangible Equity by End 2019
• ABN Amro CEO Zalm to Step Down in 2017
• Westpac refunds $9.2m to 160,000 young customers under 21
• Esure Plans to Spin Off GoCompare.com Unit Via Separate Listing

• Credit Rating News
• Activision L-T Debt Raised to Baa2 by Moody’s; Outlook Stable
• Fitch Affirms Six Chinese Mid-Tier Banks; Outlook Stable
• Fitch Affirms New Zealand’s Major Banks; Outlooks Remain Stable
• Fortescue Rtgs Unffctd By Debt Repayment: S&PGR
• S&PGR Places State of Rio de Janeiro ‘CCC-’ Rtg On Watch Neg

• Other News
• Brainard’s Argument for No September Hike Likely to Sway Fed
• Pimco Bond Fund Cuts Bet as Dimon to Gundlach Warn on Rates Path

ANALYST VIEWS

• There will be some recovery, which will be more than just a dead-cat bounce; markets will remain jittery nevertheless, wary of that rate hike (and) also won’t be helped by investor positioning: creditmarketdaily.com

NEW ISSUES

• BNG EU500m 0.25% 5/2025 Tap MS -9
• State Of Rhineland-Palatinate EU500m 3Y MS -20
• 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.