Friday, Nov. 20, 2015

Corporate Bond Market
Global equities are mixed this morning with Europe down and Asia up.  ECB president Draghi said in a speech that the central bank would do what is necessary to reach its inflation goal. The Euro traded off as a result.  US equities were flat yesterday and futures are up this morning with the DJIA +69 and S&P+6.00.  Oil is down $0.50 to $40.05/bbl.  US treasuries are flat across the curve with the 10yr at 2.250%.  Credit is opening tighter with the IG Index -.5 at 84.25/84.75.

United Healthcare said it has suffered losses on policies sold under ObamaCare and is considering dropping out of the program.  Nike reported its most profitable year ever and announced plans to buy back $12 billion in stock and split its shares 2-for-1.

Yesterday was a busy day for issuance in the IG primary market with six deals being done.  The names in the market included Grupo Televisa, GM Financial ,Bank of NY, Bunge and Intercontinental Exchange.  All are a few basis points tighter this morning.

Only Kansas City Fed Manufacturing this morning at 11:00 am.


Municipal Bond Market
Munis finished stronger across the curve on Thursday.  Buyers were active in both the secondary and primary with bumps in most maturities. We saw dealers marking up offerings and new-issue deals being oversubscribed.  The combination of muni fund inflows of $350 million mixed with a new issue calendar of under $1 billion added to the demand.  30-day supply is weaker this morning with $5 billion on tap over the next 30 days versus $6 billion Tuesday.

Volume continues to pick up in the trading of PR 8’s of 2035 for the first time in about two weeks.  PR benchmark 8’s of 2035 traded @ $71.875 (11.74%) on Monday after trading around $71.25 (11.68%) last week.

30-Day visible supply: $5bn


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