S&P fell 0.7% and Nasdaq was down 0.9% as equities continued to fall for a second day. Netflix shares were down 9% after-market after reporting a slowdown in subscribers. US10Y Treasury yields fell 5bp to 1.57%. European equities fared worse with DAX down 1.6% while CAC and FTSE were down 2%. US IG CDS spreads were 1.4bp wider and HY was 6.4bp wider. EU main CDS spreads were 1.1bp wider and crossover spreads widened 6.2bp. Asian equity markets are lower by 1% today after Wall Street’s losses yesterday and Asia ex-Japan CDS spreads have widened 5.4bp. It’s a busy day at the primary markets with six new dollar deals launched including Malaysia, Sino-Ocean and BOC.
Navigating The Bond Markets by Leveraging the BEV App
New to the BEV App? BondEvalue will be conducting a complimentary session on Navigating The Bond Markets by Leveraging the BEV App today at 5pm SG/HK. This session is aimed at helping bond investors in tracking their investments using the BondEvalue App.
New Bond Issues
- Malaysia $ 10Y sustainability/30yr Sukuk at T+90bp/T+115bp areas; books $2.3bn
- Sino-Ocean Group $ 5Y green bonds at T+305bp area; books over $1bn
- BOC Luxembourg branch $ 5Y green bond at T+100 area
- BOC Singapore branch $ 3Y green bond at T+90 area
- KNOC subsidiary Harvest Operations $ 3NC1 at T+100bp area
- Changchun Urban Development $ 3Y bond at 4.5% area
Kaisa Group raised $200m via a tap of their 9.75% 2023s at a yield of 9.15%, 30bp inside initial guidance of 9.45% area. The bonds have expected ratings of B2/B and received orders over $2.2bn, 11x issue size. Asia bought 88% and Europe 12%. Fund managers received 76%, private banks 14% and corporates 10%. Proceeds will be used for offshore debt refinancing. The bonds were issued alongside a tender offer for its $300mn 7.875% bonds due June 9, 2021 and $400mn 7.875% bonds due June 30, 2021. The purchase price for both the bonds is $1,001.5 per $1,000 in principal. The bonds currently trade at 100.14 and 100.28 respectively.
Taiwan Semiconductor Manufacturing (TSMC) raised $3.5bn via a three-trancher. It raised:
- $1.1bn via a 5Y bond at a yield of 1.3% or T+50bp, 30bp inside initial guidance of T+80bp area
- $900mn via a 7Y bond at a yield of 1.788% or T+55bp, 30bp inside initial guidance of T+85bp area
- $1.5bn via a 10Y bond at a yield of 2.269% or T+75bp, 25bp inside initial guidance of T+100bp area
The bonds have expected ratings of Aa3/AA-. In March, TSMC said they planned to issue up to $4.5bn in dollar bonds this year.
Korea Hydro & Nuclear Power raised $500mn via a 5Y bond at a yield of 1.377%, 32.5bp inside initial guidance of T+90bp area. The bonds have expected ratings of Aa2/AA and received orders over $2.5bn, 5x issue size. The issuer is wholly owned by Korea Electric Power Corp (Kepco) and operates nuclear and hydroelectric power plants.
New Bond Pipeline
- Incheon Int’l Airport $ 5Y green bond
- Pakuwon Jati hires $ 7NC4 bond
- AVIC Automotive Systems Holdings $ bonds
- Shangrao Innovation Development Industry Investment $ credit-enhanced bond offering
- Santos $ Yankee bond
China Water Affairs Group $ green bond
BOC Aviation $ bond
- Moody’s downgrades Fiji to B1; outlook remains negative
- Fitch Revises Outlook on Concord New Energy to Stable; Affirms at ‘BB-‘
- Celulosa Arauco y Constitucion Outlook Revised To Stable From Negative By S&P On Expected Deleveraging Amid Higher Pulp Prices
- Darden Restaurants Inc. Outlook Revised To Positive By S&P On Expectations For Faster Recovery; Ratings Affirmed
- Fitch Affirms Marathon Petroleum at ‘BBB’; Revises Outlook to Stable
- Fitch Withdraws Tahoe’s Ratings
- Moody’s changes Nexa’s outlook to stable; affirms Ba2 rating
- Moody’s withdraws Lifestyle’s ratings due to insufficient information