Credit

US Corporate Bonds Rise, With Stable Spreads And Lower Rates

Corporate bond issuance is very slow this week, with only a handful of deals priced today

Published ET

Despite a Recent Bounce, Pitney Bowes 5Y USD CDS Spread Is Close To Its Lowest Levels In The Last 2 years | Source: Refinitiv

Despite a Recent Bounce, Pitney Bowes 5Y USD CDS Spread Is Close To Its Lowest Levels In The Last 2 years | Source: Refinitiv

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QUICK SUMMARY

  • S&P 500 Bond Index was up 0.33% today, with investment grade up 0.34% and high yield up 0.21% (YTD total return: +0.05%)
  • The iBoxx USD Liquid Investment Grade Total Return Index was up 0.40% today (Month-to-date: 1.19%; Year-to-date: -0.41%)
  • The iBoxx USD Liquid High Yield Total Return Index was up 0.07% today (Month-to-date: 0.12%; Year-to-date: 3.16%)
  • ICE BofA US Corporate Index (Investment Grade) spread to worst unchanged at 88.0 bp (YTD change: -10.0 bp)
  • ICE BofA US High Yield Index spread to worst unchanged at 338.0 bp (YTD change: -52.0 bp)
  • S&P/LSTA U.S. Leveraged Loan 100 Index up 0.04% today (YTD total return: +2.1%)

US CORPORATE OPTION-ADJUSTED SPREAD (OAS) BY RATING

  • AAA down by -1 bp at 50 bp
  • AA unchanged at 58 bp
  • A unchanged at 74 bp
  • BBB down by -1 bp at 113 bp
  • BB unchanged at 230 bp
  • B down by -2 bp at 377 bp
  • CCC up by 1 bp at 619 bp

ICE BofAML US Corporate Spreads | Sources: phipost.com, Refinitiv data

ICE BofAML US Corporate IG & HY Spreads To Worst | Sources: ϕpost, Refinitiv dataICE BofAML US Corporate Spreads To Worst By Rating | Sources: ϕpost, Refinitiv data

CDS INDICES (mid-spreads)

  • Markit CDX.NA.IG 5Y up 0.3 bp, now at 49bp (YTD change: -0.8bp)
  • Markit CDX.NA.HY 5Y up 0.3 bp, now at 285bp (YTD change: -8.7bp)
  • Markit iTRAXX Europe down 0.6 bp, now at 47bp (YTD change: -1.0bp)
  • Markit iTRAXX Japan unchanged, now at 46bp (YTD change: -5.5bp)
  • Markit iTRAXX Asia Ex-Japan down 0.2 bp, now at 86bp (YTD change: +27.9bp)
CDX.NA.IG & CDX.NA.HY Indices Mid Spreads | Sources: ϕpost, Refinitiv dataiTRAXX Indices Mid Spreads | Sources: ϕpost, Refinitiv data

LARGEST USD CORPORATE CDS MOVES IN THE PAST WEEK

  • Talen Energy Supply LLC (Country: US; rated: BB-): down 172.4 bp to 2,855.1bp (1Y range: 875-3,156bp)
  • iStar Inc (Country: US; rated: BBB-): down 24.6 bp to 227.8bp (1Y range: 199-324bp)
  • Meritor Inc (Country: US; rated: LGD5 - 75%): down 18.0 bp to 233.7bp (1Y range: 164-266bp)
  • Lumen Technologies Inc (Country: US; rated: Ba3): down 17.5 bp to 284.7bp (1Y range: 195-533bp)
  • Cemex SAB de CV (Country: MX; rated: BB-): down 17.4 bp to 245.2bp (1Y range: 246-705bp)
  • Pitney Bowes Inc (Country: US; rated: LGD2 - 16%): down 13.3 bp to 389.0bp (1Y range: 363-1,258bp)
  • Cox Communications Inc (Country: US; rated: Baa2): up 14.5 bp to 56.1bp (1Y range: 18-60bp)
  • Macy's Inc (Country: US; rated: Ba3): up 19.7 bp to 319.6bp (1Y range: 273-1,253bp)
  • Apache Corp (Country: US; rated: WD): up 28.9 bp to 215.2bp (1Y range: 168-453bp)
  • Royal Caribbean Cruises Ltd (Country: US; rated: LGD4 - 59%): up 32.8 bp to 369.5bp (1Y range: 318-1,291bp)
  • Murphy Oil Corp (Country: US; rated: Ba3): up 41.0 bp to 338.9bp (1Y range: 280-763bp)
  • American Airlines Group Inc (Country: US; rated: B2): up 47.5 bp to 693.1bp (1Y range: 596-3,463bp)
  • Carnival Corp (Country: US; rated: LGD5 - 72%): up 53.6 bp to 413.8bp (1Y range: 291-1,214bp)
  • Transocean Inc (Country: KY; rated: Caa3): up 393.9 bp to 1,570.8bp (1Y range: 941-7,695bp)

LARGEST EURO CORPORATE CDS MOVES IN THE PAST WEEK

  • Jaguar Land Rover Automotive PLC (Country: GB; rated: WD): down 11.0 bp to 370.1bp (1Y range: 339-918bp)
  • Thyssenkrupp AG (Country: DE; rated: B1): down 4.0 bp to 289.3bp (1Y range: 206-479bp)
  • Schaeffler Finance BV (Country: NL; rated: WR): down 4.0 bp to 54.4bp (1Y range: 51-207bp)
  • Ceconomy AG (Country: DE; rated: Ba1): up 4.2 bp to 170.0bp (1Y range: 94-172bp)
  • Virgin Media Finance PLC (Country: GB; rated: WR): up 4.3 bp to 246.3bp (1Y range: 211-325bp)
  • Air France KLM SA (Country: FR; rated: B-): up 5.4 bp to 411.4bp (1Y range: 392-1,211bp)
  • Unilabs SubHolding AB (publ) (Country: SE; rated: B2): up 5.6 bp to 183.9bp (1Y range: -191bp)
  • Banca Monte dei Paschi di Siena SpA (Country: IT; rated: NP): up 5.8 bp to 228.7bp (1Y range: 188-272bp)
  • Iceland Bondco PLC (Country: GB; rated: LGD3 - 46%): up 6.5 bp to 447.5bp (1Y range: 358-738bp)
  • Kingfisher PLC (Country: GB; rated: P-2): up 6.6 bp to 76.5bp (1Y range: 66-122bp)
  • Deutsche Lufthansa AG (Country: DE; rated: Ba2): up 6.9 bp to 274.4bp (1Y range: 236-421bp)
  • Boparan Finance PLC (Country: GB; rated: WR): up 20.5 bp to 935.6bp (1Y range: 478-931bp)
  • Casino Guichard Perrachon SA (Country: FR; rated: WR): up 33.8 bp to 533.1bp (1Y range: 494-1,210bp)
  • Novafives SAS (Country: FR; rated: Caa1): up 38.9 bp to 810.5bp (1Y range: 716-1,205bp)
  • TUI AG (Country: DE; rated: LGD4 - 50%): up 79.6 bp to 801.1bp (1Y range: 590-1,799bp)

USD BOND ISSUES

  • Ashton Woods USA LLC (Home Builders | Roswell, Georgia, United States | Rating: B): US$350m Senior Note (USU04537AG82), fixed rate (4.63% coupon) maturing on 1 August 2029, priced at 100.00 (original spread of 348 bp), callable (8nc3)
  • Shandong Iron and Steel Xinheng International Company Ltd (Financial - Other | China (Mainland) | Rating: NR): US$500m Senior Note (XS2314627089), fixed rate (4.80% coupon) maturing on 28 July 2024, priced at 100.00, non callable\

Source: Credit Suisse

EUR BOND ISSUES

  • Banco Santander SA (Banking | Boadilla Del Monte, Madrid, Spain | Rating: AA+): €750m Cedula Hipotecaria (Covered Bond) (ES0413900764), fixed rate (0.02% coupon) maturing on 23 July 2031, non callable
  • BNP Paribas Issuance BV (Financial - Other | Amsterdam, Noord-Holland, France | Rating: A+): €125m Unsecured Note (XS2297334430), floating rate maturing on 27 July 2023, priced at 100.00, non callable
  • Government of Chile (Sovereign | Chile | Rating: A-): €1,000m Bond (XS2369244087), fixed rate (0.10% coupon) maturing on 26 January 2027, priced at 98.93 (original spread of 101 bp), callable (6nc5)
  • Government of Chile (Sovereign | Chile | Rating: A-): €750m Bond (XS2369244327), fixed rate (1.30% coupon) maturing on 26 July 2036, priced at 99.87 (original spread of 146 bp), callable (15nc15)
  • Indonesia, Republic of (Government) (Sovereign | Jakarta Pusat, Dki Jakarta, Indonesia | Rating: BBB): €500m Senior Note (XS2366690332), fixed rate (1.00% coupon) maturing on 28 July 2029, priced at 99.48 (original spread of 164 bp), callable (8nc8)
  • NRW Bank (Agency | Dusseldorf, Nordrhein-Westfalen, Germany | Rating: AA): €500m Inhaberschuldverschreibung (DE000NWB0AN7) zero coupon maturing on 28 July 2031, priced at 100.52 (original spread of 36 bp), non callable
  • Single Platform Investment Repackaging Entity SA (Financial - Other | Luxembourg, Netherlands | Rating: NR): €150m Unsecured Note (XS2366672512), fixed rate (1.25% coupon) maturing on 15 August 2051, priced at 100.00, non callable

NEW LOANS

  • Affidea BV (B+), signed a € 150m Term Loan B, to be used for general corporate purposes. It matures on 10/31/26 and initial pricing is set at EURIBOR +375bps

NEW ISSUES IN SECURITIZED CREDIT

  • CPS Auto Receivables Trust 2021-C issued a fixed-rate ABS backed by auto receivables in 5 tranches, for a total of US$ 291 m. Highest-rated tranche offering a yield to maturity of 0.33%, and the lowest-rated tranche a yield to maturity of 3.21%. Bookrunners: Credit Suisse, Citigroup Global Markets Inc
  • Frete 2021-Ml11 issued a fixed-rate Agency CMBS in 1 tranche, for a total of US$ 357 m, offering a yield to maturity of 2.00%. Bookrunners: Jefferies & Co Inc, Wells Fargo Securities LLC
  • Freddie Mac Seasoned Loans Structured Transaction 2021-2 issued a fixed-rate Agency RMBS in 3 tranches, for a total of US$ 704 m. Bookrunners: Wells Fargo Securities LLC, Bank of America Merrill Lynch
  • Sunnova Helios Vi Issuer LLC 2021-B issued a fixed-rate ABS backed by certificates in 2 tranches, for a total of US$ 212 m. Highest-rated tranche offering a yield to maturity of 1.62%, and the lowest-rated tranche a yield to maturity of 2.01%. Bookrunners: Credit Suisse Securities (USA) LLC
  • Corevest American Finance 2021-2 issued a fixed-rate ABS backed by rental income in 5 tranches, for a total of US$ 278 m. Highest-rated tranche offering a yield to maturity of 1.41%, and the lowest-rated tranche a yield to maturity of 3.72%. Bookrunners: Morgan Stanley International Ltd, Wells Fargo Securities LLC
  • Freddie Mac Multifamily Structured Credit Risk Notes Series 2021-Mn2 issued a floating-rate Agency RMBS in 3 tranches, for a total of US$ 233 m. Highest-rated tranche offering a spread over the floating rate of 180bp, and the lowest-rated tranche a spread of 550bp. Bookrunners: Wells Fargo Securities LLC, Bank of America Merrill Lynch
  • Carmax Auto Owner Trust 2021-3 issued a floating-rate ABS backed by auto receivables in 8 tranches, for a total of US$ 1,750 m. Bookrunners: JP Morgan & Co Inc, RBC Capital Markets, Wells Fargo Securities LLC, Bank of America Merrill Lynch, Mizuho Securities USA Inc