HALISTER1: EU CREDIT DAILY: Risk May Get FOMC Fillip; Telefonica Job Cuts

EU CREDIT DAILY: Risk May Get FOMC Fillip; Telefonica Job Cuts

(Bloomberg) -- Widening bias has returned to secondary euro corporate bond spreads after post-ECB exuberance faded but a dovish FOMC should buoy risk-asset sentiment this morning, Bloomberg strategist Simon Ballard writes.
  • That FOMC left U.S. rates unchanged came as little surprise; but accompanying dovish language scaling back tightening expectations for this year should provide a fillip for near- term risk appetite
    • Focus in U.K. now turns to today’s BOE rate decision and any Asset Purchase Target update
  • Early performance of Inbev deal, given the reported strength of order book, may be seen as a litmus test for true current depth of investor demand and perception toward degree of technical support to come from ECB’s CSPP
  • Risk Appetite Model highlights risk to secondary mkt credit spreads from pressure of new issues
  • CDX IG currently -3.4bps at 87.34 in overnight session; iTraxx Asia Ex Japan IG is currently -4.1bps at 133.40
NEWS
  • Corporate News
  • Lufthansa Profit Jumps 55% With Pricing to Hold Back 2016 Growth
  • LafargeHolcim Profit Meets Estimates as 2016 Demand Seen Growing
  • China Mobile 2015 Profit Misses Estimates, Shares Reverse Gain
  • HeidelbergCement Boosts Dividend Amid Expected 2016 Growth
  • Toyota’s China Supplier Sees Rising Profit on Hybrid Sales
  • Telefonica Deutschland to Accelerate Job Cuts: Rheinische Post
  • Bouygues, Partners Win EU675 Million Calais Port Contract
  • Financial News
  • VTB Group 2015 Net Income 10.7b Rubles vs 4.1b Rubles Y/y
  • Wells Fargo Hires Ex-JPMorgan Asia Banker as Global Banking Head
  • UBS to Continue to Invest in China, APAC Wealth Head Koh Says
  • Credit Suisse Boosts Wealth Managers Based in Singapore by 50%
  • Rating News
  • Moody’s concludes reviews of six South and Southeast Asian national oil companies
  • Fitch Affirms SKI and SKGC at ’BBB’; Outlook Revised to Stable
  • Other News
  • Fed Softens Rate-Rise Urgency as Risks Abroad Cloud Outlook
  • Pimco to Goldman Seek Vindication as Inflation Bets Start to Pay
ANALYST VIEWS
  • We might need a renewed push for the corporate bond market to tighten more aggressively after the huge spread recovery witnessed since last Thursday; will possibly not emerge until details of the corporate bond buying program are announced: creditmarketdaily.com
NEW ISSUES
  • AB Inbev EU13.25b 6-Part Deal
  • AXA Bank Europe SCF EU750m 7Y Covered Bonds MS +18
  • Barclays Plc (HoldCo) EU1.5b 5Y MS +187
  • BRFkredit EU500m 5Y Covered Bonds MS +20
  • Commerzbank EU1b 10Y Tier 2 MS +340
  • CA Home Loan SFH EU3.25b 7Y, 15Y Covered Bonds
  • Colombia EU1.35b 10Y 3.875%
  • Faurecia EU700m Senior 7.2NC3.2 Notes 3.625%
  • Kommunekredit EU1b 7Y MS +2
  • 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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