HALISTER1: EU CREDIT OPEN: Primary Open; Altice Unit’s IPO, SoftBank Tech

EU CREDIT OPEN: Primary Open; Altice Unit’s IPO, SoftBank Tech

(Bloomberg) -- Primary activity to continue today with sub investment grade Carlson Wagonlit’s 3-part EUR/USD deal pricing. It’s possible some opportunistic deals could emerge following the ECB’s QE extension and subsequent risk on sentiment.
  • Sharp rate curve steepening post ECB may favor front end of credit curve, both in terms of outright yield and total return; EUR 2s/10s currently 115bps (+11bps Thursday)
  • European IG credit pipeline here, leveraged finance pipeline here
  • Bloomberg Barclays Eur-Agg Corporate index closed Thursday at 123bps (-1bps); Bloomberg Barclays Eur HY index closed at 394bps (-4bps)
  • CDX IG closed Thursday at 68.22 (-0.5bps); iTraxx Asia Ex Japan IG is currently -0.1bps at 118.51 and iTraxx Australia quoted -2.2bps at 102.33
NEWS
  • Corporate News
  • Ferrovial Said to Be Interested in 4 Brazil Airports: Expansion
  • Altice Explores Possible IPO of Minority Stake in U.S. Unit
  • Centrica to Invest GBP180m in Energy Storage, Power Generation
  • SoftBank’s $100 Billion Tech Fund Opens HQ in London’s Mayfair
  • Financial News
  • StanChart Names Hoornweg Global Head of Financial Markets Unit
  • DBS Confirms Hong Kong Investigation After Media Report
  • ICBC Plans 10b Yuan Debt-To-Equity Swap With Shandong Gold
  • Rating News
  • S&PGR Downgrades Ensco To ‘BB’; Outlook Negative
  • S&PGR Downgrades Astoria Energy To ‘BB-’; Outlook Stable
  • Other News
  • Wall Street’s Old, Unwanted Bond Salesmen Find a Home in Chicago
  • Some ECB Governors Said to Have Pushed for 12-Month QE Extension
ANALYST VIEWS
  • With risks in EUR credit remaining skewed to the downside even beyond the short-term perspective, the CSPP-parachute surely maintains its value; we hence reiterate our call that CSPP names should constitute the staple of the low-beta diet we prescribe for 2017: Commerzbank
  • From a fixed income investors performance (outlook) perspective for 2017 there is no disaster in the ECB’s latest attempt at manipulation of the markets... policy stays easy and accommodative through 2017. We get a steeper yields curve so the banks get a leg up (as) longer- dated yields move higher but in measured fashion: creditmarketdaily.com
  • 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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