Tuesday, February 16, 2016

Corporate Bond Market
Global markets have a firm tone this morning as Saudi Arabia and Russia agree to freeze oil output and WTI trades up at $30.  Euro Stoxx +.08%, Nikkei +.20%, Hang Seng +1.08%.  Stateside stock futures up to start, DJIA Fut +211, S&P Fut +25.75.   US Treasury yields are higher at 1.783%.   Credit is better with the Investment Grade Index -5 at 116/117.  Cash spreads are slightly better in IG and HY paper is up +.25 to +.5pt. 

Lots of market moving credit news on the tape.   Freeport McMoran (FCX) bonds are up on news of an asset sale for $1bn in cash.  The paper is quoted anywhere from +2 to +5pts in early trading.   Apollo announced they are nearing a deal to acquire ADT Corp at a valuation of $10bn+.   Elsewhere, Aetna continues to gain ground on its proposed acquisition of Humana, picking up additional State approvals on the road to approval.

We would expect the firm tone this morning to lead to a few new primary transactions in the corporate market.  We know there are several deals on deck waiting for favorable market conditions and today could be the day.  We have only seen $5bn in issuance MTD.  In economic news, Empire Manufacturing (8:30am), NAHB Housing Market Index (10:00am), and Net TIC Flows (16:00pm) are due to be released today.


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