Credit

With Duration Near All-Time Highs, IG Overperforms Again Today On Lower Rates

Another strong start to the week for IG issuance with around $20bn priced today, led by SMFG's US$ 5.85 bn offering in 4 tranches

Published ET

Modified Duration Of ICE BofAML IG & HY Indices Since 2007 | Sources: ϕpost, Refinitiv data

Modified Duration Of ICE BofAML IG & HY Indices Since 2007 | Sources: ϕpost, Refinitiv data

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QUICK SUMMARY

  • S&P 500 Bond Index was up 0.29% today, with investment grade up 0.30% and high yield up 0.15% (YTD total return: +0.32%)
  • The iBoxx USD Liquid Investment Grade Total Return Index was up 0.244% today (Month-to-date: 0.33%; Year-to-date: -0.16%)
  • The iBoxx USD Liquid High Yield Total Return Index was up 0.063% today (Month-to-date: 0.31%; Year-to-date: 4.21%)
  • ICE BofA US Corporate Index (Investment Grade) spread to worst down 1bp, now at 86.0 bp (YTD change: -12.0 bp)
  • ICE BofA US High Yield Index spread to worst down 2bp at 323.0 bp (YTD change: -67.0 bp)
  • S&P/LSTA U.S. Leveraged Loan 100 Index up 0.08% today (YTD total return: +2.9%)
  • New issues: US$ 16.9bn in dollars and € 5.8bn in euros

US CORPORATE OPTION-ADJUSTED SPREAD (OAS) BY RATING

  • AAA down by -1 bp at 48 bp
  • AA unchanged at 57 bp
  • A unchanged at 72 bp
  • BBB unchanged at 112 bp
  • BB unchanged at 211 bp
  • B down by -1 bp at 358 bp
  • CCC down by -6 bp at 646 bp

ICE BofAML US Corporate Spreads by Rating | Sources: phipost.com, FactSet data

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

CDS INDICES (mid-spreads)

  • Markit CDX.NA.IG 5Y down 0.6 bp, now at 88bp (YTD change: -2.8bp)
  • Markit CDX.NA.HY 5Y down 2.6 bp, now at 275bp (YTD change: -18.6bp)
  • Markit iTRAXX Europe up 0.2 bp, now at 45bp (YTD change: -3.2bp)
  • Markit iTRAXX Japan unchanged at 43bp (YTD change: -8.7bp)
  • Markit iTRAXX Asia Ex-Japan up 0.0 bp, now at 66bp (YTD change: +7.7bp)
CDX.NA IG & HY Credit Indices Mid Spreads | Sources: ϕpost, Refinitiv dataiTRAXX Credit Indices Mid Spreads | Sources: ϕpost, Refinitiv data

USD BOND ISSUES

  • Cheniere Energy Partners LP (Gas Utility - Local Distrib | Houston, United States | Rating: BB): US$1,200m Senior Note (US16411QAL59), fixed rate (3.25% coupon) maturing on 31 January 2032, priced at 100.00 (original spread of 193 bp), callable (10nc5)
  • Extra Space Storage LP (Real Estate Investment Trust | Salt Lake City, United States | Rating: BBB): US$600m Senior Note (US30225VAG23), fixed rate (2.35% coupon) maturing on 15 March 2032, priced at 99.80 (original spread of 105 bp), callable (10nc10)
  • Gap Inc (Retail Stores - Other | San Francisco, United States | Rating: BB): US$750m Senior Note (US364760AP35), fixed rate (3.63% coupon) maturing on 1 October 2029, priced at 100.00 (original spread of 253 bp), callable (8nc3)
  • Gap Inc (Retail Stores - Other | San Francisco, United States | Rating: BB): US$750m Senior Note (US364760AQ18), fixed rate (3.88% coupon) maturing on 1 October 2031, priced at 100.00 (original spread of 256 bp), callable (10nc5)
  • Guardian Life Insurance Company of America (Life Insurance | New York City, United States | Rating: AA+): US$300m Note (US40139MBE03), fixed rate (1.63% coupon) maturing on 16 September 2028, priced at 99.94 (original spread of 53 bp), non callable
  • Hercules Capital Inc (Financial - Other | Palo Alto, United States | Rating: BBB-): US$325m Senior Note (US427096AH50), fixed rate (2.63% coupon) maturing on 16 September 2026, priced at 99.74 (original spread of 188 bp), callable (5nc5)
  • Kimco Realty Corp (Real Estate Investment Trust | Jericho, United States | Rating: BBB+): US$500m Senior Note (US49446RAY53), fixed rate (2.25% coupon) maturing on 1 December 2031, priced at 99.54 (original spread of 98 bp), callable (10nc10)
  • Lowe's Companies Inc (Retail Stores - Other | Mooresville, United States | Rating: BBB+): US$1,000m Senior Note (US548661EE32), fixed rate (2.80% coupon) maturing on 15 September 2041, priced at 99.89 (original spread of 98 bp), callable (20nc19)
  • Lowe's Companies Inc (Retail Stores - Other | Mooresville, United States | Rating: BBB+): US$1,000m Senior Note (US548661ED58), fixed rate (1.70% coupon) maturing on 15 September 2028, priced at 99.78 (original spread of 63 bp), callable (7nc7)
  • Morgan Stanley (Banking | New York City, United States | Rating: BBB): US$3,000m Subordinated Note (US61747YEF88), floating rate maturing on 16 September 2036, priced at 100.00, callable (15nc10)
  • PennyMac Financial Services Inc (Banking | Westlake Village, United States | Rating: BB-): US$500m Senior Note (US70932MAC10), fixed rate (5.75% coupon) maturing on 15 September 2031, priced at 100.00 (original spread of 443 bp), callable (10nc5)
  • Piedmont Operating Partnership LP (Home Builders | Atlanta, United States | Rating: BBB): US$300m Senior Note, fixed rate (2.75% coupon) maturing on 1 April 2032, priced at 99.51 (original spread of 148 bp), callable (11nc10)
  • Porch Group Inc (Information/Data Technology | Seattle, United States | Rating: NR): US$385m Bond, fixed rate (0.75% coupon) maturing on 15 September 2026, priced at 100.00, non callable, convertible
  • Protective Life Global Funding (Financial - Other | Wilmington, United States | Rating: NR): US$375m Note (US74368CBH60), fixed rate (1.30% coupon) maturing on 20 September 2026, priced at 100.00 (original spread of 50 bp), non callable
  • Wisconsin Power and Light Co (Utility - Other | Madison, United States | Rating: A-): US$300m Senior Debenture (US976826BP11), fixed rate (1.95% coupon) maturing on 16 September 2031, priced at 99.99 (original spread of 63 bp), callable (10nc10)
  • Indonesia, Republic of (Government) (Sovereign | Jakarta Pusat, Indonesia | Rating: BBB): US$650m Bond (US455780DG84), fixed rate (3.20% coupon) maturing on 23 September 2061, priced at 98.23 (original spread of 173 bp), callable (40nc40)
  • Industrial Bank of Korea (Agency | Seoul, South Korea | Rating: AA): US$500m Senior Note (US45604HAK32), fixed rate (0.63% coupon) maturing on 17 September 2024, priced at 99.96, non callable
  • Industrial Bank of Korea (Agency | Seoul, South Korea | Rating: AA-): US$500m Senior Note (US45604GAK58), fixed rate (0.63% coupon) maturing on 17 September 2024, priced at 99.96, non callable
  • Johnson Controls International PLC (Service - Other | Cork, Ireland | Rating: BBB+): US$500m Senior Note (US47837RAD26), fixed rate (2.00% coupon) maturing on 16 September 2031, priced at 99.18 (original spread of 77 bp), callable (10nc10)
  • Natixis SA (Banking | Paris, France | Rating: A): US$180m Unsecured Note (XS2303548635) zero coupon maturing on 8 October 2051, non callable
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: NR): US$500m Senior Note (US65480CAB19), fixed rate (1.13% coupon) maturing on 16 September 2024, priced at 99.95 (original spread of 70 bp), with a make whole call
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: BBB-): US$1,000m Senior Note (USU6547TAC46), fixed rate (1.85% coupon) maturing on 16 September 2026, priced at 99.98 (original spread of 105 bp), callable (5nc5)
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: BBB-): US$500m Senior Note (USU6547TAB62), fixed rate (1.13% coupon) maturing on 16 September 2024, priced at 99.95 (original spread of 70 bp), with a make whole call
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: BBB-): US$350m Senior Note (USU6547TAD29), fixed rate (2.45% coupon) maturing on 15 September 2028, priced at 99.96 (original spread of 135 bp), callable (7nc7)
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: NR): US$1,000m Senior Note (US65480CAC91), fixed rate (1.85% coupon) maturing on 16 September 2026, priced at 99.98 (original spread of 105 bp), callable (5nc5)
  • Nissan Motor Acceptance Company LLC (Financial - Other | Dallas, Japan | Rating: NR): US$350m Senior Note (US65480CAD74), fixed rate (2.45% coupon) maturing on 15 September 2028, priced at 99.96 (original spread of 135 bp), callable (7nc7)
  • Nomura International Funding Pte Ltd (Financial - Other | Singapore | Rating: NR): US$2,000m Unsecured Note (XS2218254899), floating rate maturing on 1 October 2036, priced at 100.00, non callable
  • Radiance Holdings (Group) Company Limited (Financial - Other | Rating: B): US$300m Senior Note (XS2384610577), fixed rate (7.80% coupon) maturing on 20 March 2024, priced at 99.56, non callable
  • Redsun Properties Group Ltd (Service - Other | Nanjing, China (Mainland) | Rating: B-): US$200m Senior Note (XS2384273475), fixed rate (9.50% coupon) maturing on 20 September 2023, priced at 97.98 (original spread of 1,055 bp), non callable
  • Shimao Group Holdings Ltd (Service - Other | Rating: BBB-): US$748m Senior Note (XS2385392936), fixed rate (5.20% coupon) maturing on 16 January 2027, priced at 99.78 (original spread of 436 bp), callable (5nc3)
  • Shimao Group Holdings Ltd (Service - Other | Rating: BBB-): US$300m Senior Note (XS2385392779), fixed rate (3.98% coupon) maturing on 16 September 2023, priced at 100.00 (original spread of 371 bp), with a make whole call
  • Sociedad Quimica y Minera de Chile SA (Chemicals | Santiago, Chile | Rating: BBB+): US$700m Senior Note (USP8718AAN65), fixed rate (3.50% coupon) maturing on 20 September 2051, priced at 99.17 (original spread of 197 bp), with a make whole call
  • Sumitomo Mitsui Financial Group Inc (Banking | Chiyoda-Ku, Japan | Rating: A-): US$1,000m Senior Note (US86562MCJ71), fixed rate (2.22% coupon) maturing on 17 September 2031, priced at 100.00 (original spread of 90 bp), non callable
  • Sumitomo Mitsui Financial Group Inc (Banking | Chiyoda-Ku, Japan | Rating: A-): US$2,000m Senior Note (US86562MCH16), fixed rate (1.40% coupon) maturing on 17 September 2026, priced at 100.00 (original spread of 60 bp), non callable
  • Sumitomo Mitsui Financial Group Inc (Banking | Chiyoda-Ku, Japan | Rating: BBB+): US$850m Subordinated Note (US86562MCK45), fixed rate (2.93% coupon) maturing on 17 September 2041, priced at 100.00 (original spread of 110 bp), non callable
  • Sumitomo Mitsui Financial Group Inc (Banking | Chiyoda-Ku, Japan | Rating: A-): US$2,000m Senior Note (US86562MCG33), fixed rate (1.90% coupon) maturing on 17 September 2028, priced at 100.00 (original spread of 80 bp), non callable

EUR BOND ISSUES

  • Air Liquide Finance SA (Financial - Other | Paris, France | Rating: AAA): €500m Senior Note (FR0014005HY8), fixed rate (0.38% coupon) maturing on 20 September 2033, priced at 99.82 (original spread of 73 bp), callable (12nc12)
  • DSV Panalpina Finance BV (Financial - Other | Venlo, Denmark | Rating: A-): €500m Senior Note (XS2387735470), fixed rate (0.88% coupon) maturing on 17 September 2036, priced at 98.89 (original spread of 103 bp), callable (15nc15)
  • Indonesia, Republic of (Government) (Sovereign | Jakarta Pusat, Dki Jakarta, Indonesia | Rating: BBB): €500m Senior Note (XS2387734317), fixed rate (1.30% coupon) maturing on 23 March 2034, priced at 99.42 (original spread of 168 bp), callable (13nc12)
  • Mmb Scf SA (Financial - Other | Courbevoie, Netherlands | Rating: NR): €500m Obligation Fonciere (Covered Bond) (FR0014005H24), fixed rate (0.01% coupon) maturing on 20 September 2031, priced at 98.98 (original spread of 44 bp), non callable
  • Societe Generale SFH SA (Financial - Other | Puteaux, France | Rating: AAA): €2,500m Obligation de Financement de l'Habitat (Covered Bond) (FR0014005DT7), fixed rate (0.28% coupon) maturing on 14 September 2032, priced at 100.00 (original spread of 100,000 bp), non callable
  • Southern Co (Utility - Other | Atlanta, Georgia, United States | Rating: BBB+): €1,250m Junior Subordinated Note (XS2387675395), fixed rate (1.88% coupon) maturing on 15 September 2081, priced at 100.00 (original spread of 249 bp), callable (60nc6)

NEW LOANS

  • Dexko Global Inc (rated CCC), signed a € 101m Delayed Draw Term Loan, a US$ 160m Delayed Draw Term Loan, a € 955m Term Loan B and a US$ 800m Term Loan B
  • US Anesthesia Partners Inc (rated B), signed a US$ 1,600m Term Loan B and a US$ 350m Term Loan, to be used for general corporate purposes
  • ILPEA Parent Inc (rated B), signed a US$ 225m Term Loan B, to be used for general corporate purposes. It matures on 09/30/28 and initial pricing is set at LIBOR +450bps