Weekly Market Review - Investfunds
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Weekly Market Review
July 26th 2021
Highlights:
• The most significant change to the US Treasury Yield Curve occurred in 5Y tenor with a respective
value of -7bps.
• The weakest EM country currency relative to the US dollar is ZAR, with -3.08% performance.
• The strongest EM country currency relative to the US dollar is RUB, with 0.38% performance.
• The country with the highest default probability based on 5Y CDS is Argentina, with a respective
value of 72.5%.
• The most considerable year-to-date change in default probability based on 5Y CDS is 20p.p. in
Argentina.
News:
• Future Retail – The Indian company Future retail has defaulted on the coupon payment on its only
USD bond issuance. Future retail is struggling with sufficient liquidity as operations affected due to
pandemic. The Reliance-Future retail deal was also stuck due to fact that Amazon objected, and the
matter is pending in court. The company expected to pay within a 30-day grace period as was done in
previous payments. The 5.6% Jan 2025 USD bond is currently quoted at 16.35% yield levels.
• Netflix – Netflix profit for the second quarter rose to USD 1.35 billion against USD 720 million the
previous year with a dip of 21% from USD 1.7 billion in previous quarter. Revenue rose 19% to USD
7.3 billion against previous year. Total paid subscribers stood at 209 million, growth of paid subscriber
slowed to 84%. Currently 6.375% May 2029 was quoted at 2.36% yield levels.
• Bank Of Ireland – Diversified Financial Services Group based in Ireland is buying the problematic
Davy stockbroker at Euro 440 million enterprise value. In March 2021, The Irish central bank fined
Euro 4.1 million to stockbroker for breaching market rules and cancelled the primary dealers’ licence.
Currently 10% Dec 2022 Euro currency bond is quoted at 0.35% yield levels.
• McLaren– The British automotive manufacturer raised USD 620 million. The company issued 5-year
bonds with a 7.5% coupon. The issue rating was CCC+. Bond proceeds will be used to refinance near
maturity debt. The company looks to deleverage the business going forward.
© Cbonds.com | Weekly Market ReportLargest High Yield Issues
Amount, Issuer Rating End of
Issue Country
mln USD M/S/F Placement
Redco Properties Group, 11%
China 321 –/B/B+ 19.07.2021
6aug2022, USD
Zhenro Properties Group,
China 247 B1/–/B+ 19.07.2021
7.125% 30jun2022, CNY
Road King Infrastructure,
Hong Kong 500 Ba3/BB-/– 19.07.2021
5.125% 26jul2026, USD
Times China Holdings, 5.55%
China 500 Ba3/BB-/BB- 20.07.2021
4jun2024, USD
Compania de Minas
Buenaventura, 5.5% 23jul2026, Peru 550 B1/–/BB 20.07.2021
USD
Stonegate Pub, 8.25% 31jul2025, United
1699 B3/–/B- 22.07.2021
GBP Kingdom
Ukraine, 6.876% 21may2029,
Ukraine 1750 B3/B/B 22.07.2021
USD
*High yield placements included with an outstanding amount of more than $200 million, taking place between 19.07.2021 and
23.07.2021
Sovereign Rating Changes on July 17-July 23
New Old Date
Country
Rating Outlook Rating Outlook Rating
Cote
BB- Stable B+ Positive 19-07-2021
d`Ivoire
Under review
Sri Lanka Caa1 Caa1 Stable 19-07-2021
downgrade
Rwanda B+ Negative B+ Stable 21-07-2021
Cyprus Ba1 Stable Ba2 Positive 23-07-2021
© Cbonds.com | Weekly Market ReportCbonds Country Sovereign Eurobonds Indices
Eurobond sovereign indices measure T-spread, total yield and other indicators for the major issuing
countries. They are calculated once every trading day (at close).
© Cbonds.com | Weekly Market ReportMarket Indices & US Treasury Yield Curve
UST 2Y UST 10Y DOW NASDAQ
S&P500 SOFR
YTM YTM JONES COMPOSITE
Last value 0.22 1.30 35061.55 4411.79 14836.99 0.05
Change -12.00% -0.76% 1.08% 1.96% 2.84% 0.00%
*The change for all indices except SOFR is calculated as a difference between values at 16.07.2021 and 23.07.2021. For SOFR
change calculated as a difference between values at 16.07.2021 and 22.07.2021.
US markets ended higher, recovering from a sharp fall earlier in the week. As second quarter earnings growth
is strong for US technology companies, stocks continue to rise. In July, US manufacturing PMI index increased
to 63.1. The Dow Jones and S&P 500 indexes are up by 1.08% and 1.96% WoW, respectively.
Last week US treasury yields were volatile ahead of the US Fed meeting this week, markets keenly look for
US economic recovery and asset taper comments. Yields fell 1-7 bps across the curve. The US 10-year
benchmark bond closed 1 bps lower, 1.30%. During the week US 10-year touched 1.19% levels.
© Cbonds.com | Weekly Market ReportCurrency Rate Indices
Currency rate indices track US dollar dynamics relative to foreign currencies. They are calculated once every
trading day (at close).
© Cbonds.com | Weekly Market ReportICE and Interactive Default Probability Indices
Default probability indices assess the risks on the Sovereign debt market for the respective country. They are
calculated based on CDS for terms of between 3 months and 30 years and calculated once every trading day
(at close).
© Cbonds.com | Weekly Market ReportWeekly Knowledge Hub:
Sinkable Bond
A sinkable bond is a bond that is secured by a fund that the issuer creates to pay the principal of the debt
according to a stated repayment schedule.
A sinking fund is a pool of funds set aside by a company to pay off previously issued debt before a specified
maturity date on a predetermined schedule. The issuer does not reserve all the money at once but replenishes
the fund regularly (not as described in the repayment schedule, but more often).
Sinkable bonds can be beneficial for issuers. They are a cheaper way to raise funds, as the issuer lowers the
borrowing rate due to the positive impact the sinking fund has on the credit rating. From an investor’s point
of view, sinkable bonds are investment vehicles with a low level of risk.
Examples of Sinkable Bonds include the issue of municipalities Bay Area Toll Authority, 5% 1apr2054, as
well as the issue of corporate issuer Albar Mimunit Services, 3.25% 13jan2027.
Read more about bond types in the Cbonds glossary
Contact details:
Dmitrii Larionov, Specialist of the International Debt Markets Department,
d.larionov@cbonds.info
Paresh Nemade, India Representative,
tel: + 91 9221297616, pareshnemade@cbonds.info
Cbonds subscription:
pro@cbonds.info
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