Halister News

(Bloomberg) -- Credit market sentiment appears to have swung 180 degrees, from fearing the prospect of a second- or third-quarter FOMC rate hike to embracing it. After risk assets weakened in early May, we are firmly back in risk-on mode, at least for now, Bloomberg strategist Simon Ballard writes.

• Risk assets are buoyed by the hawkish idea of strengthening macroeconomic fundamentals; Asia credit firm overnight
  • However, the market’s susceptibility to near-term event risk is still elevated; U.S. rates, U.K. EU membership referendum may carry extreme market volatility risk in coming weeks
• Greece debt agreement in principle is a clear fillip for the EUR credit mkt; but longer-term debt sustainability may still be in doubt, creating a “buy the rumor, sell the fact” moment for some investors
• Risk Appetite model shows spreads grinding tighter but with increased volatility

• CDX IG closed -0.7bps at 77.03 in overnight session; iTraxx Asia Ex Japan IG currently -2.1bps at 141.19

NEWS

• Corporate News
• Total Reports Flow Loss at Bacton Seal U.K. Gas Terminal Site
• Tate & Lyle FY Revenue, Adjusted EPS Ahead of Estimates
• Daily Mail 1H Profit Falls; Results Hit by Weak Print Ads Market
• Uniqa 1Q Profit Halves on Investment Income; Outlook Confirmed
• Darty 4Q Like-for-Like Rev. Rises 12%

• Financial News
• Standard Bank 4-Month Expense Growth Exceeds Income Growth
• Alliance Financial 4Q Net Rises to 129.8m Rgt vs 93.3m Rgt Y/y
• Senior Bondholders Added to Bail-In Buffer in Danish Experiment
• Suncorp Falls Most in Three Months After Analysts Downgrade

• Credit Rating News
• Australia Banks Asset Quality to Come Under Pressure: Moody’s
• S&PGR Rates Nykredit Realkredit’s Proposed Tier 3 Notes ’BBB+’
• Macau Economy Seen at Risk as Moody’s Downgrades Gaming Hub

• Other News
• Greece’s Journey to Redemption Remains a Long One After Aid Deal
• Bank Indonesia Prepares Rules to Allow Structured Products

ANALYST VIEWS

• Rising markets usually lift confidence, encourage more risk- taking and can boost activity. That’s not the case right now, though as we don’t see enough fundamental economic improvements anywhere to justify sharply rising markets: creditmarketdaily.com

NEW ISSUES

• Affordable Housing Finance GBP161m 2.893% Tap UKT +35
• Bright Food EU400m 3Y MS +185
• Castilla Y Leon EU400m 5Y Interp. SPGB +28
• China Development Bank EU1b 5Y MS +60
• Credit Mutuel Arkea EU500m 10Y Tier 2 MS +270
• Credit Agricole EU1b 12/2022 MS +63
• Danske Bank EU1b 7Y MS +62
• Erste Group Bank EU500m PNC5.5 With 8.875% Coupon
• HeidelbergCement EU750m 8Y MS +205
• Immob. Grande Distribuzione EU300m 5Y MS +250
• JCDecaux EU750m 7Y MS +80
• State of Berlin EU250m 0.75% 9/2023 Tap MS -9
• Hoist Kredit EU250m 12/2019 3.125%
• 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.