Thursday, April 14, 2016

Corporate Bond Market
US Equity Futures are down to start the session with the DJ Futures at -2 and the S&P Futures are -.50.  Overseas equities were mixed overnight as European stocks rally and Asian markets show positive and negative indicators.  Rates and oil continue to be stagnant, hovering at 1.78% and $41.88 respectively this morning.  Credit remains firm with the Investment Grade Index unchanged at 78/79, while cash is moving up slightly.  This has been a light week in new issuance due to earnings.  Of those issued, we have been active in Credit Suisse, Bank of Finland, and National Rural.

In the news, Bank of America, BlackRock, and PNC posted first-quarter profit that missed analysts’ estimates.  Wells Fargo announced earnings that beat projections.

In economic news, Initial Jobless Claims are due out later this morning.


Municipal Bond Market
Munis are unchanged this morning after a mixed trading day yesterday.  We saw a brief sell off on the long end early in the morning, however, the market reversed throughout the day with the long munis finishing up on the day.  Demand has been extremely light this month with the uncertainty of tax season having a major impact on the muni market.  We continue to see balances remaining on a variety of new issue deals and little attention for the secondary.   30 day supply is weaker this morning with $10bn scheduled over the next 30 days versus $11bn Wednesday.

In credit news, AGM announced that it would purchase CIFG in an all cash offer.   The announcement does not have a direct effect on any underlying PR credits, however it should lead to a substantial pop in CIFG insured PR.  PR 8’s of 2035 continue to rebounded with bonds trading @ $68 after trading around $65 last week.

30-Day visible supply: $10bn


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