Tuesday, May 9, 2017

Corporate Bond Market
US Equity Futures are up to start the session with the DJ Futures +35 and the S&P Futures +3. Overseas equity markets are mostly stronger through the overnight with the exception of China. US Treasuries are down with yields on the 10 yr last at 2.4% and oil is weaker, last quoted $46.19/barrel. Credit is tighter with the Investment Grade Index showing 44.25/45.68 and cash is stronger.

In credit news, Monday’s primary market saw $13.3bn priced in Investment Grade Credit with Intel leading the charge. From yesterday’s new issuance, we are active in Intel, Amgen, PPL Energy and Appalachian Power. Today is expected to be a busy day in the primary market with deals already announced from: Bank of NY, Capital One, CK Hutchinson, Costco, Hexion, Community Health, Springleaf Finance, Resolute Energy, Entergy Arkansas, and Enjoy S.A.

In economic data, monthly change in wholesale inventories will be reported this morning.

Municipal Bond Market
Despite Treasuries being weaker on Monday, the yield on the 10-year benchmark muni GO was flat from 2.17% on Friday. No big deals came to market yesterday. Traders are waiting for Cuyahoga County, Ohio, and the state of Hawaii to price for retail investors today and institutions on Wednesday. Today we will see deals from Houston Independent School District and San Francisco Bay Area Rapid Transit District. Citigroup is pricing $838 million of limited tax schoolhouse and refunding bonds for the Houston Independent School District in Texas for retail today and for institutions tomorrow. Likewise, Barclays Capital is set to price $388.85 million of GO bonds for the San Francisco Bay Area Rapid Transit District. Both deals are rated AAA by Moody’s and S&P.