Browsing articles tagged with " mischler financial group"
Muni Market New Issue Calendar Week 09-04-18
September 2018      Muni Market   

New Muni Debt Offerings Scheduled for the Holiday-Shortened Week of September 04-Last week muni volume was about $4.5 billion. This holiday-shortened week volume is expected to be $3.6billion. The negotiated market is led by $900.9million future tax bonds for New York City Transitional Finance Authority, New York. The competitive market is led by $989.3 million tax-exempt and taxable general obligation bonds for the State of California on Thursday.

As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6676.

muni-market-new-issue-calendar

During first half of 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc. (more…)

Municipal Debt New Issue Calendar-Week August 27-Salute to Senator John McCain
August 2018      Muni Market   

New Muni Debt Offerings Scheduled Week of August 27 2018 & Note of Condolence and Tribute to Senator John McCain, a true American Hero.  This week’s Mischler Muni Market Update is dedicated to and sadly prefaced by Mischler Financial Group note of condolence to the family of Senator John McCain and our tribute to a man who was not only a valiant military hero who made so many personal sacrifices throughout his military career and served with great honor, he dedicated his life to our country throughout a multi-decade leadership role within the halls of the US Senate. Senator McCain exemplified what is truly great about our country–his integrity, honesty, humility, pure sense of humanity and passionate dedication to advocating on behalf of those who could not advocate on behalf of themselves made him a role model in every sense of the phrase. Those who dare to dispute whether those captured behind military lines and then tortured while being held in captivity as a POW ‘deserve’ to be referred to as a hero know not what an American Hero is and seemingly, know even less as to the many reasons why the United States of America is and has always remained the world’s icon of freedom and democracy since our founding fathers forged our Constitution and Bill of Rights.

john-mccain-visit-nyse-trading-floor

Senator John McCain visit to NYSE days after 9/11

In an new era that has been distracted by political gamesmanship and what seems to be a frightening cultural shift that portends to threaten long embraced values, right-minded views and thoughtful approach to government leadership–and the very fabric of what we have always held dear, Senator McCain proved he really was a ‘maverick’; up until his last breathing moments he was determined to be a voice of reason and sensibility. Never one to take his oath of office for granted, McCain’s legacy for always reaching across the aisle to engage with and embrace those who may have disagreed with his views in order to forge legislation and policy for the betterment of all the people puts him on a pedestal that only a handful of American leaders throughout the country’s history can make claim to.

Many of us at Mischler Financial have served in the US Military, several of us served during the Vietnam ‘conflict’ and more than several of us were injured in the line of duty. We have the scars to prove it, should we have to. Military veterans are by and large, a unique community of people. We’re trained to defend and honor the rights of all Americans and trained to fight with honor, even to the death, in order to protect our comrades in arms and all of our countrymen and countrywomen. For many of us, that training has led to battlefield engagements and injuries sustained that we prefer not to speak of. Instead, our personal missions and our mission as members of a highly-skilled team of professionals has remained true to the oath we each took when joining the US military–to uphold the Constitution and to defend the rights and liberties of all Americans–and to preserve and protect the values that has always made America great. We’re proud to carry over those disciplines and sense of duty in the course of serving our financial and investment industry clients as well as their constituents and the communities we live in.

We’re perhaps even more proud to salute Senator John McCain, who inspired us all when saying, “Courage is not the absence of fear, but the capacity to act despite our fears.” 

Last week muni volume was about $3.7 billion.  This week volume is expected to be about $3.9 billion.  The negotiated market is led by $727.2 million general obligation bonds for The Commonwealth of Massachusetts.  The competitive market is led by $502.1 million tax-exempt and taxable general obligation and motor vehicle fuel tax bonds for the State of Washington in 3 bids on Wednesday.

As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6676.

muni-new-issue-calendar-mischler

During first half of 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete.  All opinions and estimates included in this report are subject to change without notice.  This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security.   Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

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American Water Works Floats Debt Offering with Diversity & Inclusion Faucet
August 2018      Debt Market Commentary, Recent Deals   

Quigley’s Corner 08.06.18  American Water Works Taps Debt Market and Floats Deal with Diversity & Inclusion Faucet

Investment Grade Corporate Bonds New Issue Re-Cap

Syndicate IG Corporate-only Volume Estimates For This Week and August

American Water Deal Dashboard

American Water Works: Diversity and Inclusion Flows From the Top Down

New Issues Priced

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

Indexes and New Issue Volume

Global Market Recap

2018 Lipper Report/Fund Flows – Week ending July 25th

IIG Credit Spreads by Rating

IG Credit Spreads by Industry

New Issue Pipeline

M&A Pipeline

Economic Data Releases

Rates Trading Lab

Tomorrow’s Calendar

QC Geopolitical Risk Monitor

Below is the opening extract from Quigley’s Corner aka “QC”  Monday, Aug 6, 2018  edition distributed via email to institutional investment managers and Fortune Treasury clients of Mischler Financial Group, the investment industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans.

Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”the QC is one of three distinctive market comment pieces produced by Mischler Financial Group. The QC is a daily synopsis of everything Syndicate and Secondary as seen from the perch of our primary debt capital markets desk and includes a comprehensive “deep dive” with optics on the day’s investment grade corporate debt new issuance and secondary market data encompassing among other items, comparables, investment grade credit spreads, new issue activity, secondary market most active issues, and upcoming pipeline. To receive Quigley’s Corner, please email: rquigley@mischlerfinancial.com or via phone 203.276.6646 

Today the IG dollar DCM hosted 11 issuers across 19 tranches totaling $10.95b.  The SSA space was quiet.

Here’s a look at the WTD and MTD IG Corporate new issue volume as measured against syndicate desk estimates:

 

  • The IG Corporate WTD total is 50.53% of this week’s syndicate midpoint average forecast or $10.95b vs. $21.67b.
  • MTD we’ve priced 30.86% of the syndicate forecast for July IG Corporate new issuance or $19.985b vs. $64.75b.
  • There are now 16 issuers in the IG credit pipeline.

 

Today’s IG Primary & Secondary Market Talking Points

 

  • Ventas Realty LP upsized today’s 10-year Senior Notes new issue to $750mm from $600mm at the launch and at the tightest side of guidance.
  • The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 18 IG Corporate-only new issues was <18.53> bps.
  • Including today’s Prudential $25 par Junior Subordinated Notes transaction spread compression across the 19 IG Corporate new issues was <17.88> bps.
  • BAML’s IG Master Index tightened 1 bp to +115 vs. +116. (It’s post-Crisis low is +90 set on 2/01).
  • Bloomberg/Barclays US IG Corporate Bond Index OAS was unchanged at 1.09. (1.24 represents the high on 6/04; 0.85 is the post-Crisis low set on 1/30).
  • Standard & Poor’s Investment Grade Composite Spread tightened 1 bp to +149 vs. +150. (+125 represents its post-Crisis low set 2/02).
  • Investment grade corporate bond trading posted a final Trace count of $11.9b on Friday versus $17b on Thursday and $13.4b the previous Friday.
  • The 10-DMA stands at $17.9b.

 

Syndicate IG Corporate-only Volume Estimates For This Week and August

 

IG Corporate New Issuance This Week
8/06-8/10
vs. Current
WTD – $10.95b
August 2018 vs. Current
MTD – $19.985b
Low-End Avg. $20.10b 54.48% $63.88b 31.29%
Midpoint Avg. $21.67b 50.53% $64.75b 30.86%
High-End Avg. $23.23b 47.14% $65.62b 30.46%
The High $25b 43.80% $50b 39.97%
The Low $15b 73.00% $76b 26.30%

 

American Water Deal Dashboard

american-water-works-diversity-inclusion-debt-offering

 

Today Mischler was honored to serve as a passive Co-Manager on American Water’s $1.325b two-part 10- and 30-year Senior Notes transaction.  For relative value we had looked at the following comparables and adjusted for the low dollar price on AWK’s outstanding comps arriving at 2 bps concession per tranche.

AMERICAN WATER (A3/A)

AWK 2.95 09/27  +75   g76     $94

AWK 3.75 09/47  +107           $93

NSTAR ELECTRIC CO (A2/A+)

ES 3.20 05/27     +80   g81     $96

ES 4.40 03/44     +105           $104

 

CONSOLIDATED EDISON CO NY (A2/A-)

ED 3.80 05/28    +69   g69    $101

ED 3.875 06/47  +112           $95

 

INDIANA MICHIGAN POWER (A3/A-)

AEP 3.85 05/28    +85   g85       $100

AEP 3.75 07/47    +111              $93

 

VIRGINIA ELECTRIC & POWER CO (A2/BBB+)

D 3.80 04/28    +84    g84     $100

D 3.80 09/47    +109             $94

 

Use of proceeds from today’s transaction will be used to lend funds to American Water and its regulated operating subsidiaries; to repay $191.1mm principal amount of the issuer’s 5.62% Senior Notes due 2018 upon maturity on December 21, 2018; to redeem up to $200mm aggregate principal amount of the issuer’s outstanding long-term debt securities due in 2019 and 2022 and which have a weighted-average interest rate of 5.70%; to repay commercial paper obligations of the issuer, including commercial paper incurred to fund in part the acquisition of all of the capital stock of Pivotal Home Solutions Co., and for general corporate purposes.

Here’s a look at price evolution throughout today’s book build followed all the critically important deal information you need and want to know:

 

AWK Issue RATING IPTs GUIDANCE LAUNCH PRICED Spread
Compression
NIC
(bps)
Trading at
the Break
+/-
(bps)
10yr A3/A +95-100/+97.5a +85a (+/-3) +82 +82 <15.50> bps 2 81/78 <1>
30yr A3/A +125-130/+127.5a +115a (+/-3) +112 +112 <15.50> bps 2 111/108 <1>

 

American Water’s two-part cumulative order book total finished at $3.80b making the $1.325b transaction 2.87-times oversubscribed.

Here’s a look at the book build at the top and where they finished following launching both tranches at the tightest side of respective guidance.

 

AWK Issue Tranche Size Book
at-the-Top
Final Book
Size
Bid-to-Cover
Rate
10yr $625mm $1.8b $1.8b 2.88x
30yr $700mm $2.3b $2.0b 2.86x

 

That’s a very successful outcome!

Final Pricing – American Water

AWK $625mm 3.75% due 9/01/2028 @$99.981 to yield 3.752% or T+82  MWC +15

AWK $700mm 4.20% due 9/01/2048 @$99.946 to yield 4.203% or T+112  MWC +20

 

American Water Works : Diversity and Inclusion

With a history dating back to 1886, American Water Works Company Inc. (NYSE: AWK) is the largest and most geographically diverse U.S. publicly traded water and wastewater utility company. The company employs more than 6,900 dedicated professionals who provide regulated and market-based drinking water, wastewater and other related services to an estimated 15 million people in 46 states and Ontario, Canada. American Water provides safe, clean, affordable and reliable water services to its customers to make sure they keep their lives flowing.

American Water’s workforce reflects the diversity of customers it serves nationwide.  Diversity of ideas, thoughts and experiences is vital to American Water’s culture and the way it does business. Creating an environment where differences are embraced and where every employee feels engaged and included makes everyone safer, stronger and more successful.

American Water encourages, honors and celebrates differences in its employees, including race, gender, spiritual practice, ethnicity, age, nationality, military/veteran status, sexual orientation, physical capabilities, education and personal style to name just a few. Diverse employees make it more successful in serving its very diverse customers across the country; a philosophy and cultural foundation that has been long embraced and advanced by Mischler Financial et al!

American Water wants to foster an environment where its people can work safely, generate great ideas, provide the best customer service, and make a difference in the communities it serves. By cultivating a diverse and inclusive work environment guided by its core values, American Water enables any one person or group to develop the next big idea, delight their customers, grow the company and create a future of success.

There are a host of certifications that fall under the category of diversity aka minority broker-dealers.  This once “cottage industry” among our financial services experienced growing pains over the last three decades as each company attempted to become more of a full service BD.  Each were challenged by capital consistency, value-added distribution propositions, meaningful capital markets coverage, etc. I am, however, happy to say that a group has emerged from those that have raised the bar so to speak in terms of execution and capabilities.  Today, the guy-in-the-corner affirms and commends American Water for inviting a total of 10, yes that’s right T-E-N diversity firms that served as passive Co-Managers on today’s $1.325b two-part transaction.  It’s a privilege and honor to serve American Water and to be recognized among our brethren in the space.

Mischler sends its five-star salute to American Water’s Treasury/Funding Team today’s honored position to serve on your transaction.  Shout outs, however, aren’t only reserved for the Treasury/Funding teams who embrace and apply their internal corporate D&I mandates by including minority-certified broker dealers on their transactions. Please allow me to now send some shout-outs to those nine additional diversity firms who were featured alongside Mischler Financial Group, Inc., our nation’s oldest Service Disabled Veteran owned & operated broker dealer.  Along with Mischler role, it’s reflective of some of the firms getting it right in the space, in their own unique and different way.

In alphabetical order they are:

Blaylock Van, LLC, C.L. King & Associates, Loop Capital Markets,MFR Securities, Inc.,Multi-Bank Securities, Inc.,Ramirez & Co., Inc., Siebert Cisneros Shank & Co., L.L.C., Telsey Advisory Group, The Williams Capital Group, L.P.

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

 

Issuer Ratings Coupon Maturity Size IPTs GUIDANCE LAUNCH PRICED LEADS
American Water Capital Corp. A3/A 3.75% 9/01/2028 625 +95-100/+97.5a +85a (+/-3) +82 +82 MIZ/MUFG/RBC/TD (a)
BAML/PNC (p)
American Water Capital Corp. A3/A 4.20% 9/01/2048 700 +125-130/+127.5a +115a (+/-3) +112 +112 MIZ/MUFG/RBC/TD (a)
BAML/PNC (p)
Associated Bank NA Baa1/BBB- 3.50% 8/13/2021 300 +100a +90a (+/-2.5) +87.5 +87.5 CITI/RBC
Bank of New York Mellon A/AA- 3.45% 8/11/2023 750 +80a +68a (+/-3) +65 +65 BAML/BNY/BARC/HSBC/WFS
Bank of New York Mellon
(tap) New Total $900mm
A/AA- 3.85% 4/28/2028 400 +90a +78a (+/-3) +75 +75 BAML/BNY/BARC/HSBC/WFS
Discover Bank BBB-/BBB 4.682% 8/09/2028 500 +210a +190a (+/-2.5) +187.5 +187.5 BARC/CITI/RBC
Duke Energy Progress LLC Aa3/A 3.375% 9/01/2023 300 +75a +60a (+/-3) +57 +57 JPM/MIZ/SCOT/STRH
Duke Energy Progress LLC Aa3/A 3.70% 9/01/2028 500 +95a +80a (+/-3) +77 +77 JPM/MIZ/SCOT/STRH
Ford Motor Credit Co. LLC Baa2/BBB FRN 10/12/2021 500 3mL+equiv 3mL+equiv 3mL+88 3mL+88 CS/CACIB/GS/HSBC (a) + 3 (p)
Ford Motor Credit Co. LLC Baa2/BBB 3.813% 10/12/2021 1,150 +130a +110a (+/-2) +108 +108 CS/CACIB/GS/HSBC (a) + 3 (p)
Ford Motor Credit Co. LLC Baa2/BBB 4.687% 6/09/2025 600 +200a +185a (+/-5) +180 +180 CS/CACIB/GS/HSBC (a) + 3 (p)
Indiana Michigan Power Co. A2/A- 4.25% 8/15/2048 475 +135a +125a (+/-5) +120 +120 BNY/CACIB/CS/PNC
Intercontinental Exchange A2/A 3.45% 9/21/2023 400 +85a +70a (+/-5) +65 +65 BAML/MUFG/WFS
Intercontinental Exchange A2/A 3.75% 9/21/2028 600 +115a +95a (+/-5) +90 +90 BAML/MUFG/WFS
Intercontinental Exchange A2/A 4.25% 9/21/2048 1,250 +145a +125a (+/-5) +120 +120 BAML/MUFG/WFS
PACCAR Financial Corp. A1/A+ 3.15% 8/09/2021 350 +60a +45a (+/-2) +43 +43 CITI/LLOYD/RBC/USB
PACCAR Financial Corp. A1/A+ 3.40% 8/09/2023 300 +75a +62a (+/-2) +60 +60 CITI/LLOYD/RBC/USB
Prudential Financial, Inc. Baa2/BBB+ 5.625% 40NC5
8/15/2058
500 5.625-5.75%
5.6875%a
5.625 the # 5.625% $25 par
Jr. Subs.
BAML/MS/UBS/WFS
Ventas Realty Baa1/BBB+ 4.40% 1/15/2029 750 +165-170/+167.5a +150a (+/-3) +147 +147 MIZ/MS/TD/WFS

…..and here’s another look at last week’s day-by-day re-cap of key primary market driver averages for IG Corporates only followed by the prior six week’s averages:

KEY IG CORPORATE
NEW ISSUE DRIVERS
MON.
7/30
TUES.
7/31
WED.
8/01
TH.
8/02
FRI.
8/03
AVERAGES
WEEK 7/30
AVERAGES
WEEK 7/23
AVERAGES
WEEK 7/16
AVERAGES
WEEK 7/09
AVERAGES
WEEK 7/02
AVERAGES
WEEK 6/25
New Issue Concessions <4.63> bps 2.00 bps 0.00 bps/flat 4.67 bps N/A <1.06> bps 1.50 bps 3.90 bps 3.45 bps No Issuance 9.87 bps
Oversubscription Rates 6.02x 1.91x 3.18x 3.55x N/A 4.29x 3.40x 2.33x 2.31x No Issuance 2.03x
Tenors 24.63 yrs 6.67 yrs 3.00 yrs 7.13 yrs N/A 13.33 yrs 9.00 yrs 7.73 yrs 9.24 yrs No Issuance 8.99 yrs
Tranche Sizes $369mm $950mm $450mm $1,017mm N/A $706mm $601mm $1,031mm $693mm No Issuance $504mm
Avg. Spd. Compression
IPTs to Launch
<21.25> bps <18.33> bps <12.50> bps <15.72> bps N/A <17.89> bps <16.89> bps <13.79> bps <13.39> bps No Issuance <6.58> bps

 

New Issues Priced

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Muni Yields; Scheduled Municipal Debt Offerings Week of July 30
July 2018      Muni Market   

Municipal Debt Deals-New Issue Calendar Week of July 30:  Muni Yields Tick Up…Mischler Muni Market Update looks back to last week’s muni bond issuance, municipal bond fund flow metrics and a focused lens on the muni bond new offerings for this week.  As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Last week muni volume was about $6.6 billion. This week volume is expected to be $4.4 billion. The negotiated market is led by $974.0 million Lodging Tax Revenue Bonds for Washington State Convention Center Public Facilities District. The competitive market is led by $510.0 million general obligation bonds for the State of Maryland on Wednesday

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6676

muni-market-new-issue-calendar-mischler

During first half of 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

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Corporate Bond Issuers Return to IG Dollar Market; Toyota Drives DCM
July 2018      Debt Market Commentary   

Quigley’s Corner 07.10.18 – Corporate Bond Issuers Return to IG Dollar Market; Toyota Drives DCM

 

Investment Grade Corporate Bond New Issue Re-Cap

Today’s IG Primary & Secondary Market Talking Points

Syndicate IG Corporate-only Volume Estimates For This Week and July

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

New IG Corporate Bond Issues Priced

Indexes and New Issue Volume              

Global Market Recap

2018 Lipper Report/Fund Flows – Week ending July 4th

IG Credit Spreads by Rating

IG Credit Spreads by Industry

New Issue Pipeline

M&A Pipeline Highlights

Economic Data Releases

Rates Trading Lab

Tomorrow’s Calendar

 

Below is the opening extract from Quigley’s Corner aka “QC”  Tuesday,  July 10, 2018  edition distributed via email to institutional investment managers and Fortune Treasury clients of Mischler Financial Group, the investment industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans.

Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”, the QC is one of three distinctive market comment pieces produced by Mischler Financial Group. The QC is a daily synopsis of everything Syndicate and Secondary as seen from the perch of our primary debt capital markets desk and includes a comprehensive “deep dive” with optics on the day’s investment grade corporate debt new issuance and secondary market data encompassing among other items, comparables, investment grade credit spreads, new issue activity, secondary market most active issues, and upcoming pipeline. 

To receive Quigley’s Corner, please email: rquigley@mischlerfinancial.com or via phone 203.276.6646 

Investment Grade New Issue Re-Cap

Today the IG dollar Corporate primary market finally awoke. It awoke not from a slumber but rather from a historic streak of sluggishness when considering 10 of the last 12 sessions produced an anemic $3.527b in total volume floated by US corporate bond issuers.  Today’s IG dollar DCM hosted 4 issuers across 7 tranches totalling $5.075b.  The SSA space added 2 issuers and 4 tranches for $7.50b bringing the all-in IG day totals to 6 issuers, 11 tranches and $12.575b. The all-in IG dollar pipeline saw three issuers clear trades today  – Toyota Motor Corp., EIB and JBIC while adding Nonghyup Bank to the forward schedule.  As a generalization, today’s prints were flat to tighter at the break conveying stability and attractive as opposed to aggressive pricing tactics and in line with IG credit spreads coming in the last couple of sessions – a sign of reassurance. We all know too well that the past two weeks’ issuance silence has been deafening as big FIGs lurk on the horizon to provide feed into voracious investor appetite for a new high-quality credit product.

 

Here’s a look at the WTD and MTD IG Corporate Bond Issuers’ new issue volume as measured against syndicate desk estimates:

 

  • The IG Corporate WTD total is 28.07% of this week’s syndicate midpoint average forecast or $5.075b vs. $18.08b.
  • MTD we’ve priced 6.22% of the syndicate forecast for June IG Corporate new issuance or $5.075b vs. $81.54b.
  • There are now 20 issuers in the IG credit pipeline.

                                  

Today’s IG Primary & Secondary Market Talking Points

 

  • PacifiCorp upsized today’s 30.5-year FMB new issue to $600mm from $500mm at the launch after having skipped guidance.
  • The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 7 IG Corporate-only new issues was <11.94> bps.
  • BAML’s IG Master Index tightened 1 bp to +127 vs. +128. (It’s post-Crisis low is +90 set on 2/01).
  • Bloomberg/Barclays US IG Corporate Bond Index OAS tightened 2 bps to +120 vs. 1.22. (1.24 represents the high on 6/04; 0.85 is its post-Crisis low set on 1/30).
  • Standard & Poor’s Investment Grade Composite Spread tightened 3 bps to +159 vs. +162. (+125 represents its post-Crisis low set 2/02).
  • Investment grade corporate bond trading posted a final Trace count of $18.8b on Monday versus $7.6b on Friday and $11.6b the previous Monday.
  • The 10-DMA stands at $15.6b.

 

Syndicate IG Corporate-only Volume Estimates For This Week and July

 

IG Corporate New Issuance This Week
7/09-7/13
vs. Current
WTD – $5.075b
July 2018 vs. Current
MTD – $5.075b
Low-End Avg. $16.84b 30.14% $81.04b 6.26%
Midpoint Avg. $18.08b 28.07% $81.54b 6.22%
High-End Avg. $19.32b 26.27% $82.04b 6.16%
The High $10b 50.75% $60b 8.46%
The Low $30b 16.92% $100b 5.075%

 

 

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

 

Here’s a review of this week’s five key primary market driver averages for IG Corporates only through Monday’s session followed by the averages over the prior six weeks:

KEY IG CORPORATE
NEW ISSUE DRIVERS
MON.
7/09
AVERAGES
WEEK 7/02
AVERAGES
WEEK 6/25
AVERAGES
WEEK 6/18
AVERAGES
WEEK 6/11
AVERAGES
WEEK 6/04
AVERAGES
WEEK 5/28
New Issue Concessions N/A No Issuance 9.87 bps +7.50 bps +4.02 bps +6.31 bps +9.00 bps
Oversubscription Rates N/A No Issuance 2.03x 2.59x 2.89x 2.70x 2.73x
Tenors N/A No Issuance 12.58 yrs 11.08 yrs 11.10 yrs 9.25 yrs 9.69 yrs
Tranche Sizes N/A No Issuance $504mm $1,134mm $724mm $623mm $467mm
Avg. Spd. Compression
IPTs to Launch
N/A No Issuance <6.58> bps <13.11> bps <13.76> bps <13.80> bps <8.23> bps

 

New Issues Priced

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Muni Market New Issue: NYS Dormitory Authority Mental Health Bonds
June 2018      Muni Market   

Municipal Debt Deals-New Issue Calendar Week of June 25:  NYS Dormitory Authority Mental Health Bonds …Mischler Muni Market Update looks back to last week’s new issuance, muni bond fund flow metrics and a focused lens on the municipal bond offerings for this week.  As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Last week muni volume was about $6.4 billion. This week volume is expected to be about $5.3 billion. The negotiated market is led by $342.7 million mental health bonds (NYC Issue) for Dormitory Authority of the State of New York. The competitive market is led by $1.5billion Tax and Revenue Anticipation Notes on Tuesday and $335.7 million general obligation bonds in 3 bids on Wednesday for the City of Los Angeles, California.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

muni-market-new-offerings-june-25-2018

During first half of 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

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Muni Bond Inflows Continue To Creep Up; Mischler New Issue Outlook
June 2018      Muni Market   

Municipal Debt Deals-New Issue Calendar Week of June 18:  Muni Bond Inflows Continue To Creep Up…Mischler Muni Market Update looks back to last week’s new issuance, muni bond fund flow metrics and a focused lens on the muni bond offerings for this week.  As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Last week muni volume was about $6.8 billion. This week volume is expected to be about $7.0 billion. The negotiated market is led by $1.7 billion asset-backed tobacco bonds for Golden State Tobacco Securitization Corporation,California. The competitive market is led by $1.2 billion for the State of Georgia (on Tuesday)

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

Muni Market New Offerings week June 18

During Q1 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

 

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GM Drives Debt Capital Markets Deals On Flag Day; In Step With Vets
June 2018      Debt Market Commentary, Recent Deals   

Quigley’s Corner 06.14.18 – GM Drives Debt Capital Markets Deal Deal; In Step With Vets

 

Investment Grade New Issue Re-Cap – Push Me, Pull You – Our Inextricably Global Linked World Economy

Today’s IG Primary & Secondary Market Talking Points

Syndicate IG Corporate-only Volume Estimates For This Week and June

General Motors Financial Co. Inc. $1bn 5-year Senior Notes due 6/19/2023

General Motors Financial Co. Inc. Deal Dashboard

General Motors Diversity & Inclusion Starts From the Top Down

The “QC” Geopolitical Risk Monitor

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

New Issues Priced

Indexes and New Issue Volume 

Global Market Recap

2018 Lipper Report/Fund Flows – Week ending June 6th 

IG Credit Spreads by Rating

IG Credit Spreads by Industry 

New Issue Pipeline

M&A Pipeline Highlights – $596.02 Billion in Cumulative Enterprise Value

Economic Data Releases

Rates Trading Lab

UST Resistance/Support Table

Tomorrow’s Calendar

ECB President Mario Draghi announced that the European monetary body voted to stop its massive bond-buying program though assuring markets that rates will remain unchanged thru the summer of 2019. The bond purchase program will end in December which caused European equity markets to surge 1.10% on average as the dollar gained against the single currency. Draghi also “warned” against U.S. trade tariffs. Draghi was stern in declaring that trade negotiations have to take place within the “existing multilateral framework.” He pointed out that the framework in question was developed post World War II creating prosperity throughout Europe that could be undermined by trade wars. That’s rather ominous coming from the ECB head. Considering the new world order’s multiple “bad players” I’d be more reasonable on trade negotiations and much more concerned about the defense and protection of my continent and what surly customers might decide to turn off their gas pipelines to Eastern Europe in the middle of February. It’s been done before and nothing should surprise anyone anymore.

With the days of easing money coming to end, Emerging Markets currencies are set up to take a hit much like Argentina’s peso did today plunging 6.1% to $27.70 per dollar, a record low. 

Today the IG dollar DCM continued rocking and rolling following its FOMC hiatus yesterday hosting 10 issuers across 18 tranches totaling $12.35b.  The SSA space was quiet.
Today’s largest deal was UnitedHealth Group’s $4b 5-part but the Deal-of-the-Day belongs to General Motors Financial Co. Inc. You know why right?  That’s right………because Mischler Financial, the nation’s oldest SDVBE was involved.

But before we get to that deal drill down and GM D&I segment, let’s first recap the day..

Here’s a look at the WTD and MTD IG Corporate new issue volume as measured against syndicate desk estimates:

  • The IG Corporate WTD total is 120.10% of this week’s syndicate midpoint average forecast or $24.62b vs. $20.50b.
  • MTD we’ve priced 69.20% of the syndicate forecast for June IG Corporate new issuance or $62.58b vs. $90.44b.
  • There are now 18 issuers in the IG credit pipeline.

 

Today’s IG Primary & Secondary Market Talking Points

 

  • Deutsche Telkom International Finance BV upsized its 144a/REGS two-part Senior Notes new issue to $1.75b from $1.5b at the launch.
  • The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 16 IG Corporate-only new issues – that displayed spread compression – was <14.84> bps.
  • BAML’s IG Master Index tightened 1 bp to +121 vs. +122. (It’s post-Crisis low is +90 set on 2/01).
  • Bloomberg/Barclays US IG Corporate Bond Index OAS was unchanged at 1.15. (1.16 represents a new high; 0.85 is its post-Crisis low set on 1/30).
  • Standard & Poor’s Investment Grade Composite Spread was unchanged at +153. (+125 represents its post-Crisis low set 2/02).
  • Investment grade corporate bond trading posted a final Trace count of $20.4b on Wednesday versus $19.6b on Tuesday and $19.2b the previous Wednesday.
  • The 10-DMA stands at $17.9b.

 

Syndicate IG Corporate-only Volume Estimates For This Week and June

 

IG Corporate New Issuance This Week
6/11-6/15
vs. Current
WTD – $24.62b
June 2018 vs. Current
MTD – $62.58b
Low-End Avg. $19.30b 127.56% $91.24b 68.59%
Midpoint Avg. $20.50b 120.10% $90.44b 69.20%
High-End Avg. $21.70b 113.46% $89.64b 69.81%
The High $12b 205.17% $75b 83.44%
The Low $30b 82.07% $110b 56.89%

 

General Motors Financial Co. Inc. $1bn 5-year Senior Notes due 6/19/2023

Mischler Financial is very happy to announce that it was invited to serve as an active 0.50% active Co-Manager on today’s $1b 5-year Senior Notes new issue for General Motors Financial Co. Inc. We appreciate the opportunity to serve GM.  

In terms of relative value, I looked to the outstanding GM Financial 3.70% due 5/09/2023 that was G+133 pre-announcement pegging NIC on today’s new print at T+137.5 as 4.5 bps.

Use of proceeds: added to the general funds of GM Financial and will be available for general corporate purposes.

 

General Motors Financial Co. Inc. Deal Dashboard

 

GM Issue RATING IPTs GUIDANCE LAUNCH PRICED Spread
Compression
NIC
(bps)
Trading at
the Break
+/-
(bps)
5yr FXD Baa3/BBB +155a +140a (+/-2.5) +137.5 +137.5 <17.50> 4.5 136/134 <1.5>

 

………and here’s a snap shot of today’s final General Motors Financial Co. Inc. book size and oversubscription rate – the measure of investor demand:

Today’s General Motors Financial Co. Inc. final order book finished at $3.10b making the $1b 5-year Senior Notes transaction 3.1-times oversubscribed. “At the top” or at guidance, the book was $4.0b. Clearly a highly successful transaction on a day in which 10 issuers tapped the IG dollar DCM pricing 18 tranches between them!

Our Mischler five-star salute goes out to Team General Motors Treasury/Funding on this – Flag Day – especially Anne. I enjoyed speaking with you today and appreciated your accessibility and feedback! But I can’t stop there………..

Thank you as always to team Barclays Syndicate especially Ray Zeek.  It’s always a great pleasure working with any members of the Barclays A-Team. Ray –  I appreciated your thoroughness, updates, data exchanges and working with me on all the fine details for this evening’s “QC” GM relative value drill-down.  Thank you pal!

Last but NEVER least hats off to the best darn middle markets distribution network out there.  You’re all great and I/we appreciate your loyalty and patronage on each and every deal.  

 

GM Issue Tranche Size Book
at-the-Top
Final Book
Size
Bid-to-Cover
Rate
5yr FXD 1bn $4.0b $3.1b 3.10x

 

Final Pricing – General Motors Financial Co. Inc.
GM $1b 4.15% due 6/19/2023 @$99.852 to yield 4.183% or T+137.5  MWC +25

General Motors Diversity & Inclusion Starts From the Top Down

general-motors-dcm-military-veterans

 

We know General Motors embraces a diverse work force. They always have. The difficulty comes in sustaining such great programs and the challenge is growing and expanding them.  These mandates begin from the top down and that means from the office of Chairman and CEO, Mary Barra. In fact, GM’s new Chief Financial Officer Dhivya Suryadevara starts in her new role on September 1st. Now THAT is what I call a value-added diversity and inclusion proposition literally starting from the top down. Bravo General Motors!

GM celebrates the unique perspectives it gains from its global employees. Its workforce provides a wide-array of diverse backgrounds and experiences and it’s their contributions that place GM at the forefront of innovation.  By embracing a diversity of thought, GM is able to develop mobility solutions that meet the needs of a rapidly changing global society and move humanity into the future.

To learn more about General Motors D&I please click on this link for GM’s 2017 Diversity and Inclusion Report:
http://www.gmsustainability.com/pdf/downloads/GM_Diversity_and_Inclusion.pdf

More to the core of our shared ethos here at Mischler Financial Group, Inc., our great nation’s oldest Service Disabled Veteran broker dealer, are some more specifics about the wonderful initiatives taken by General Motors to help our men and women in uniform – those that are prepared to make the ultimate sacrifice for us all.

Below please find a synopsis of today’s DCM data as curated by the Investment Grade Syndicate Desk at Mischler Financial Group. Have a great evening!

Ron Quigley, Managing Director and Head of Fixed Income Syndicate

 

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

 

Here’s a review of this week’s five key primary market driver averages for IG Corporates only through Wednesday’s session followed by the averages over the prior six weeks:

KEY IG CORPORATE
NEW ISSUE DRIVERS
MON.
6/11
TUES.
6/12
WED.
6/13
AVERAGES
WEEK 6/04
AVERAGES
WEEK 5/28
AVERAGES
WEEK 5/21
AVERAGES
WEEK 5/14
AVERAGES
WEEK 5/07
AVERAGES
WEEK 4/30
New Issue Concessions 3.40 bps 5.60 bps N/A 6.31 bps 9.00 bps 9.67 bps 4.59 bps 4.10 bps 5.92 bps
Oversubscription Rates 2.74x 2.44x N/A 2.70x 2.73x 2.93x 2.96x 2.70x 2.16x
Tenors 9.77 yrs 8.52 yrs N/A 9.25 yrs 9.69 yrs 7.70 yrs 10.18 yrs 7.04 yrs 13.17 yrs
Tranche Sizes $579mm $1,080mm N/A $623mm $467mm $952mm $842mm $805mm $630mm
Avg. Spd. Compression
IPTs to Launch
<12.11> bps <13.90> bps N/A <13.80> bps <8.23> bps <18.71> yrs <15.12> bps <12.91> bps <12.54> bps

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Debt Markets Remember D-Day: Normandy 1944; Mischler Financial Comment
June 2018      Debt Market Commentary   

Quigley’s Corner 06.06.18 – 17 Issuers, 29 Tranches $11b in New Issuance; Mischler Financial Tribute to D-Day

Investment Grade New Issue Re-Cap – WTD IG & SSA Issuance Matches 2018 High as 54 Tranches Price in 3 Sessions!

Today’s IG Primary & Secondary Market Talking Points

Syndicate IG Corporate-only Volume Estimates For This Week and June

Remembering D-Day

Syndicate IG Corporate-only Volume Estimates For This Week and June

The “QC” Geopolitical Risk Monitor

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

New Issues Priced

Indexes and New Issue Volume 

Global Market Recap

2018 Lipper Report/Fund Flows – Week ending May 30th        

IG Credit Spreads by Rating

IG Credit Spreads by Industry

New Issue Pipeline

M&A Pipeline

Economic Data Releases

Rates Trading Lab

Tomorrow’s Calendar     

Today the IG dollar DCM continued rolling along hosting 8 issuers across 14 tranches totaling $7.20b.  The SSA space added KfW’s $4b 2-year Global Notes new issue bringing the all-in IG day totals to 9 issuers, 15 tranches and $11.20b. Week to date we have now priced 54 tranches matching the 2018 weekly high after only three sessions and including 2 IG rated preferreds and 2 SSA issues.

Here’s a look at the WTD and MTD IG Corporate new issue volume as measured against syndicate desk estimates:

  • The IG Corporate WTD total is 132.53% of this week’s syndicate midpoint average forecast or $33.45b vs. $25.24b.
  • MTD we’ve priced 37.65% of the syndicate forecast for April IG Corporate new issuance or $34.055b vs. $90.44b.
  • There are now 14 issuers in the IG credit pipeline.

Today’s IG Primary & Secondary Market Talking Points

  • NiSource Inc. upsized today’s 144a/REGS $1,000 par PerpNC5 transaction to $400mm from $350mm at the launch and at the tightest side of guidance.
  • The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 14 IG Corporate and Preferred-only new issues was <14.07> bps.
  • BAML’s IG Master Index widened 1 bp to +121 vs. +120. (It’s post-Crisis low is +90 set on 2/01).
  • Bloomberg/Barclays US IG Corporate Bond Index OAS widened 1 bp to 1.15 vs. +1.14 thereby tying its high. (0.85 is its post-Crisis low set on 1/30).
  • Standard & Poor’s Investment Grade Composite Spread widened 1 bp to +153 vs. +152. (+125 represents its post-Crisis low set 2/02).
  • Investment grade corporate bond trading posted a final Trace count of $18.3b on Tuesday versus $16b on Wednesday and $21.9b the previous Tuesday.
  • The 10-DMA stands at $17.4b. 

Syndicate IG Corporate-only Volume Estimates For This Week and June

 

IG Corporate New Issuance This Week
6/04-6/08
vs. Current
WTD – $33.45mm
June 2018 vs. Current
MTD – $34.055b
Low-End Avg. $24.44b 136.87% $91.24b 37.32%
Midpoint Avg. $25.24b 132.53% $90.44b 37.65%
High-End Avg. $26.04b 128.46% $89.64b 37.99%
The High $20b 167.25% $75b 45.41%
The Low $35b 95.57% $110b 30.96%

Remembering D-Day and the Greatest Generation: 74 years Ago Today

Today marks the 74th anniversary of Operation Overlord, the Allied invasion of Normandy, most commonly known as D-Day. An epic multinational amphibious and airborne operation, D-Day forged partnerships and reinforced trans-Atlantic bonds that remain strong to this day. U.S. service members from 20 units in Europe and the United States have commemorated the D-Day anniversary over the past week in almost 40 locations throughout the Normandy region.

remember-D-Day-Normandy-Mischler-Financial

Never forget!

Have a great evening!
Ron Quigley, Managing Director & Head of Fixed Income Syndicate

 

 

 

*Normandy – American Cemetery

NICs, Bid-to-Covers, Tenors, Sizes and Average Spread Compression from IPTs thru Launches

 

Here’s a review of this week’s five key primary market driver averages for IG Corporates only through Tuesday’s session followed by the averages over the prior six weeks:

KEY IG CORPORATE
NEW ISSUE DRIVERS
MON.
6/04
TUES.
6/05
AVERAGES
WEEK 5/28
AVERAGES
WEEK 5/21
AVERAGES
WEEK 5/14
AVERAGES
WEEK 5/07
AVERAGES
WEEK 4/30
AVERAGES
WEEK 4/23
New Issue Concessions 6.33 bps 6.61 bps 9.00 bps 9.67 bps 4.59 bps 4.10 bps 5.92 bps 3.63 bps
Oversubscription Rates 2.77x 2.77x 2.73x 2.93x 2.96x 2.70x 2.16x 2.53x
Tenors 7.92 bps 10.40 bps 9.69 yrs 7.70 yrs 10.18 yrs 7.04 yrs 13.17 yrs 9.19 yrs
Tranche Sizes $622mm $741mm $467mm $952mm $842mm $805mm $630mm $786mm
Avg. Spd. Compression
IPTs to Launch
<13.38> bps <13.51> bps <8.23> bps <18.71> yrs <15.12> bps <12.91> bps <12.54> bps <13.85> bps

 

New Issues Priced

Today’s recap of visitors to our IG dollar Corporate and SSA DCM:

Please Note: for ratings I use the better two of Moody’s, S&P or Fitch.

 

IG

Issuer Ratings Coupon Maturity Size IPTs GUIDANCE LAUNCH PRICED LEADS
Alliant Energy Finance Baa1/A- 3.75% 6/15/2023 400 +115a +100a (+/-5) +95 +95 BAML/JPM/MIZ
Alliant Energy Finance Baa1/A- 4.25% 6/15/2028 300 +145a +135a (+/-5) +130 +130 BAML/JPM/MIZ
Compass Bank Baa2/BBB+ FRN 6/11/2021 450 3mL+equiv 3mL+73 the # 3mL+73 3mL+73 BBVA/CITI/GS/MS
Compass Bank Baa2/BBB+ 3.50% 6/11/2021 700 +110a +95 the # +95 +95 BBVA/CITI/GS/MS
Credit Suisse Group AG BBB+/A- FRN 6NC5
6/12/2024
750 3mL+equiv N/A 3mL+124 3mL+124 CS-sole
Credit Suisse Group AG BBB+/A- 4.207% 6NC5
6/12/2024
1,250 +150a N/A +140 +140
Reset:
3mL+124
CS-sole
Edwards Life Sciences Baa2/BBB- 4.30% 6/15/2028 600 +150-155/+152.5a +140a (+/-5) +135 +135 BAML/JPM (a) + 4 (p)
Jackson Na’l. Life Glbl. Fdg. A1/AA- FRN 6/11/2021 500 3mL+equiv 3mL+48-50 3mL+48 3mL+48 BAML/DB/GS/JPM
Jackson Na’l. Life Glbl. Fdg. A1/AA- 3.30% 6/11/2021 300 +80-85/+82.5a +70-72 +70 +70 BAML/DB/GS/JPM
Jackson Na’l. Life Glbl. Fdg. A1/AA- 3.875% 6/11/2025 400 +110a +98-100 +98 +98 BAML/DB/GS/JPM
KeyBank NA/Cleveland, OH A3/A- 3.35% 6/15/2021 500 +85a +72a (+/-2) +70 +70 GS/JPM/KEY/MS
NiSource Inc. Baa2/BBB+ 3.65% 6/15/2023 350 +105-110/+107.5a +90a (+/-2.5) +87.5 +87.5 CS/JPM/MS/MUFG
NiSource Inc. BBB-/BB+ 5.65% PerpNC5 400 5.875%a 5.70%a (+/-5) 5.65% $1000 par CS/JPM/MS/MUFG
Western Union Co. Baa2/BBB+ 4.25% 6/09/2023 300 +145a N/A +145 +145 BAML/BARC

 

SSA

Issuer Ratings Coupon Maturity Size IPTs GUIDANCE LAUNCH PRICED LEADS
KfW Aaa/AAA 2.75% 7/15/2020 4,000 MS<2>a MS<2>a MS<3> +23.8 BARC/HSBC/RBC

 

Indexes and New Issue Volume              

Countable IG volume includes maturities of 18-months and out and IG-rated Preferreds.

*Denotes new high or tight.

 

Index Open Current Change  
IG30 64.169 63.742 <0.427>
VIX 12.40 11.64 <0.76>
CT10 2.929% 2.973% 0.044
S&P 2,749 2,772 23  
DOW 24,800 25,146 346
Nasdaq 7,638 *7,689 51
OIL 65.52 65.01 <0.51>  
GOLD 1,296 1,296 0  
 

USD

 

IG Corporates

 

USD

 

Total (IG + SSA)

DAY: $7.20 bn DAY: $11.20 bn
WTD: $33.45 bn WTD: $37.95 bn
MTD: $34.055 bn MTD: $38.555 bn
YTD: $618.251 bn YTD: $772.816 bn

 

Global Market Recap

 

  • USTs were sold; the yield curve steepened – T2 +2, T5 +4, T10 +4, T30 +4.
  • Overseas Bonds: EU, Gilts & Peripherals sold.  Asia flat.
  • SOFR: -0.05 to 1.75 vs. 1.80.
  • 3mth Libor: +0.006 to 2.319 vs. 2.313%.
  • Overseas Stocks: Asia up Europe mostly red except the CAC.
  • Currencies: DXY Index -0.241 to 93.635 vs. 93.876.
  • CDX HY: -3.363 to 338.194 vs. 341.557.
  • CDX EM: -0.287 to 171.909 vs. 172.196.

*Index levels are as of 5:00PM ET today.

2018 Lipper Report/Fund Flows – Week ending May 30th             

  • For the week ended May 30th, Lipper U.S. Fund Flows reported a net inflow of $848.978m into Corporate Investment Grade Funds (2018 YTD net inflow of $43.822b) and a net outflow of $17.869m from High Yield Funds (2018 YTD net outflow of $15.138b).
  • Over the same period, Lipper reported a net inflow of $274.880m from Loan Participation Funds (2018 YTD net inflow of $7.156b).
  • Emerging Market debt funds reported a net inflow of $27.322m (2018 YTD inflow of $1.990b). 

IG Credit Spreads by Rating

The 10-day IG spread performance vs. the T10 across the ratings spectrum and how IG compared versus high yield:

Spreads across the four IG asset classes are 24.50 bps wider versus their new post-Crisis lows

*Denotes new post-Crisis low

 

ASSET CLASS 6/05 6/04 6/01 5/31 5/30 5/29 5/28 5/25 5/24 5/23 1-Day Change 10-Day Trend PC
low
IG Avg. 121 120 121 122 120 120 116 116 115 115 +1 +6 90 (2/01/18)
“AAA” 62 62 62 63 63 63 60 60 60 60 0 +2 48 (2/02/18)
“AA” 72 71 71 72 70 69 67 67 67 67 +1 +5 51 (2/02/18)
“A” 97 96 97 98 97 96 92 92 92 92 +1 +5 71 (2/01/18)
“BBB” 152 152 153 154 152 151 147 147 146 146 0 +6 115 (2/02/18)
IG vs. HY 229 229 234 241 244 255 237 237 234 233 0 <5> 222 (5/15/18)

 

IG Credit Spreads by Industry

…….and a snapshot of the major investment grade sector credit spreads for the past ten sessions:

Spreads across the major industry sectors are an average 31.42 bps wider versus their post-Crisis lows!
*Denotes new post-Crisis low!

INDUSTRY 6/05 6/04 6/01 5/31 5/30 5/29 5/28 5/25 5/24 5/23 1-Day Change 10-Day Trend PC
low
Automotive 106 105 106 107 106 104 102 102 102 102 +1 +4 67
Banking 109 109 110 111 110 109 103 103 102 102 0 +7 75 (2/02/18)
Basic Industry 154 153 154 155 153 154 148 148 147 147 +1 +7 110 (2/02/2018)
Cap Goods 99 98 99 99 99 98 96 96 95 95 +1 +4 75 (1/12/18)
Cons. Prod. 109 108 110 110 108 107 105 105 105 105 +1 +4 78 (2/01/18)
Energy 154 152 153 154 150 150 146 146 145 145 +2 +9 115 (2/02/18)
Financials 124 124 124 125 122 121 119 119 119 118 0 +6 97
Healthcare 105 105 105 106 104 103 102 102 101 101 0 +4 77 (2/02/2018)
Industrials 124 123 124 125 123 122 119 119 119 119 +1 +5 93 (2/02/18)
Insurance 130 130 130 132 130 130 127 127 126 125 0 +5 100 (2/02/18)
Leisure 129 127 128 127 126 125 125 125 125 123 +2 +6 98 (2/01/18)
Media 156 156 157 157 155 154 150 150 150 148 0 +8 113
Real Estate 129 129 129 130 129 129 128 128 127 127 0 +2 100 (2/01/18)
Retail 111 111 112 112 112 111 109 109 108 108 0 +3 82 (2/02/18)
Services 111 111 112 112 110 109 108 108 107 107 0 +4 94  (1/31/18)
Technology 90 89 91 91 90 90 86 86 86 86 +1 +4 71 (2/02/18)
Telecom 159 159 160 162 161 160 155 155 154 153 0 +6 122
Transportation 128 124 127 127 125 124 122 122 121 121 +4 +7 91 (2/02/2018)
Utility 124 127 124 125 123 123 119 119 119 119 <3> +5 96 (2/02/2018)

                                   

New Issue Pipeline

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Muni Bond New Issue Volume Bumps Up to 2018 Record-Mischler Update
June 2018      Muni Market   

Municipal Debt Deals-New Issue Calendar Week of June 4 : Week’s Muni Bond New Issue Volume Approaching 2018 Record…Mischler Muni Market Update looks back to last week’s new issue and muni bond fund flow metrics and provides a focused lens on the muni bond offerings for this week.  As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Last week was holiday shortened and muni volume was about $2.2 billion. This week volume is expected to be about $9.6 billion. The negotiated market is led by $1.2 billion bonds for California Municipal Finance Authority for the LINXS APM Project. The competitive market is led by $423.8 million bonds for New Mexico Finance Authority on Thursday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

muni-market-new-issue-calendar-mischler

During Q1 2018, and full years 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $625 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE).  Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

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