Tuesday, September 20, 2016

Corporate Bond Market

US Equity Futures are up to start the session with the DJ Futures +60 and the S&P Futures +6.5. The global tone is positive with overseas equities trading higher through the overnight. Oil is down to $42.68/ barrel and rates are stronger with the 10yr Treasury last at 1.68%. Credit feels firm with the Invest Grade Index showing 73.8/74.3 and cash is also up this morning.

 In credit news, Monday’s primary market saw $14.6bn priced in new issue credit. We are active in American Airlines, Hess, and Shire from yesterday’s issuance. There are a few deals on the calendar for today. Corporacion Andina de Fomento, JP Morgan, Northwell Healthcare, Woori Bank, and CAF are all set to price this afternoon.

Municipal Bond Market        
Munis are unchanged this morning heading into the FOMC meeting.  Demand has been nonexistent in both the primary and secondary to start the week.  Liquidity has been minimal across all sectors as dealers struggle to move positions that are underwater after the most recent sell off.  Supply is stronger this morning with $13.4 on tap over the next 30 days versus $13bln on Monday.

PR trading continues to slow down with the muni market on hold.  Insured paper remains in focus with aggressive bidding from both customers and dealers.  PR 8’s were unchanged with bonds trading @ 67F.

30 Day visible supply: 13.41bln