Bond market data and technology, BondEvalue

BondEvalue

Bond market data and technology

BondEvalue is a Singapore-based Fintech that specializes in bond market data and technology. The company's information services business offers bond market data on hard-currency corporate & sovereign bonds across Asia, Middle East, Europe and the Americas. The data, which includes bond prices, yields, news and analytics, is offered to end investors via interactive Mobile and Web Apps. Investors can sign up for a free trial of the service either via the company's website (https://bondevalue.com) or by downloading the BondEvalue Mobile App (http://onelink.to/wej7jq). BondEvalue is also developing an electronic bond exchange, BondbloX in Singapore that allows investors to trade bonds electronically in smaller sizes (US$1,000 or equivalent). For more information, visit https://www.bondblox.com/

Bond Market Data and Technology

Credit

S&amp;P ended flat on Friday while Nasdaq was 0.8% higher. The US 10Y Treasury yield was 2bp lower. Financials underperformed the index as the Fed confirmed it would not extend the Supplementary Leverage Ratio (Term of the Day, explained below) beyond the March 31, 2021 deadline set last year. Meanwhile, European equities fell with the DAX down 1%, CAC and FTSE down ~1.1%. US IG CDS spreads were 0.4bp tighter and HY was 4.3bp tighter. EU main CDS spreads were 0.2bp tighter and crossover spreads widened 1.2bp. Asian equity markets have opened slightly higher, up 0.3% and Asia ex-Japan CDS spreads are tighter 0.1bp.

Naver & JunFa Launch $ Bonds; Macro; Rating Changes; New Bond Issuances; Talking Heads; Top Gaine...

Financials Credit Analyst

Hank Calenti, CFA

CreditContinuum

It is difficult to make a truly bullish argument on behalf of US Treasuries now. The bottom line is it is still not time to buy duration. Risk yes. Duration no. Emerging Markets? It depends.The Fed re-anchored short-term, front-end, interest rate expectations via the Dot Plot, the Chairman’s comments, and actions to aid the overnight rate market. Overall, it was a better-than-expected communique from the Fed. With a spike of inflation next on the horizon, it may be a hard act to follow.Inflation can hide a host of sins. It can benefit financials and borrowers, but not the vulnerable in society, as inflation is a regressive tax. From a financial market perspective, it is difficult to envision a near-term spike in inflation as being credit positive. Market interest rates may overshoot as insurance against out-of-control inflation expectations. Risk assets, in particular Emerging Market assets, could over-react while the Fed under-reacts.The risk is that US policy makers are “fighting the last war.” Rather than continued curve steepening, we may see a period of consolidation, as short-end interest rate expectations rise at a faster rate,  essentially flattening the yield curve. We expect the Fed to be on watch for this.For financials, we anticipate improved net interest income levels during Q2 as both volume and yields rise. This would also result in higher non-interest income revenues as fee income soars from increased transactions. However, trading activity may see some institutions off-sides in terms of mistiming the market. We believe that it is better to be in banks with solid core operating revenues, rather than firms that have rediscovered and become over-reliant, once again, on trading activity.The recent back-up in US interest rates may be an opportunity to reload in some Emerging Markets (EM), just not in Turkey. Central bank independence is shattered once again by the firing of the Central Bank Governor. Only four months into the role, the former Governor is being replaced by an interest rate dove. We expect a large correction in Turkish bank bond as the markets digest this implausible reality next week. It may be better to focus on opportunities off the radar. EM high yield, but low duration, sovereign and more frontier bonds may be the answer. We cite a few inside.In terms of recent performance, in Asia, short duration and long risk bank bonds kept pace with Treasury weakness to end the week unchanged on a total return basis. Meanwhile, longer-dated European bank Contingent Capital (CoCos) managed to keep pace with Treasury market weakness to end the week unchanged on a total return basis. Each Additional Tier 1 bond callable in 2030 and 2031 tightened by 10 basis points. Given the simultaneous tightening, we ascribe this performance as due a restart of the AstraZeneca shot across the lagging EU’s vaccine effort. A third round of lockdowns may unwind these gains next week. Market Outlook: The US economy may run very hot before we see a change in Fed policy regarding short-term interest rates and the US dollar should remain stronger than analysts forecasted at year-end. Broadly, this is not Emerging Market friendly; however, a strong US economic rebound should benefit EM and European financials. First, we may need to get past the upcoming inflation spike.

It is difficult to make a truly bullish argument on behalf of US Treasuries now. The bottom line is it is still not time to buy duration. Risk yes. Duration no. Emerging Markets? It depends.The Fed re-anchored short-term, front-end, interest rate expectations via the Dot Plot, the Chairman’s comments, and actions to aid the overnight rate market. Overall, it was a better-than-expected communique from the Fed. With a spike of inflation next on the horizon, it may be a hard act to follow.Inflation can hide a host of sins. It can benefit financials and borrowers, but not the vulnerable in society, as inflation is a regressive tax. From a financial market perspective, it is difficult to envision a near-term spike in inflation as being credit positive. Market interest rates may overshoot as insurance against out-of-control inflation expectations. Risk assets, in particular Emerging Market assets, could over-react while the Fed under-reacts.The risk is that US policy makers are “fighting the last war.” Rather than continued curve steepening, we may see a period of consolidation, as short-end interest rate expectations rise at a faster rate,  essentially flattening the yield curve. We expect the Fed to be on watch for this.For financials, we anticipate improved net interest income levels during Q2 as both volume and yields rise. This would also result in higher non-interest income revenues as fee income soars from increased transactions. However, trading activity may see some institutions off-sides in terms of mistiming the market. We believe that it is better to be in banks with solid core operating revenues, rather than firms that have rediscovered and become over-reliant, once again, on trading activity.The recent back-up in US interest rates may be an opportunity to reload in some Emerging Markets (EM), just not in Turkey. Central bank independence is shattered once again by the firing of the Central Bank Governor. Only four months into the role, the former Governor is being replaced by an interest rate dove. We expect a large correction in Turkish bank bond as the markets digest this implausible reality next week. It may be better to focus on opportunities off the radar. EM high yield, but low duration, sovereign and more frontier bonds may be the answer. We cite a few inside.In terms of recent performance, in Asia, short duration and long risk bank bonds kept pace with Treasury weakness to end the week unchanged on a total return basis. Meanwhile, longer-dated European bank Contingent Capital (CoCos) managed to keep pace with Treasury market weakness to end the week unchanged on a total return basis. Each Additional Tier 1 bond callable in 2030 and 2031 tightened by 10 basis points. Given the simultaneous tightening, we ascribe this performance as due a restart of the AstraZeneca shot across the lagging EU’s vaccine effort. A third round of lockdowns may unwind these gains next week. Market Outlook: The US economy may run very hot before we see a change in Fed policy regarding short-term interest rates and the US dollar should remain stronger than analysts forecasted at year-end. Broadly, this is not Emerging Market friendly; however, a strong US economic rebound should benefit EM and European financials. First, we may need to get past the upcoming inflation spike.

Bank Credit Weekly: Inflation, the Next Market Challenge or Opportunity?

US equities fell yesterday with the S&amp;P down 1.5% while the tech heavy Nasdaq slipped over 3%. Apple, Amazon and Netflix fell over 3.4%. The only sector in the green was financials, up 0.6%. The fall in equities came after the 10Y Treasury yield shot to 1.75% and then pulled back to 1.70%. US Philly Fed Manufacturing Index printed at a massive 51.8 vs. a forecast of 23, its highest level in almost 48 years while US jobless claims for the prior week was up 45k to 770k vs. the 700k forecast. European equities ended higher with the DAX up 1.2% while the FTSE and CAC were up 0.3% and 0.1%. US IG CDS spreads were 1.6bp wider and HY was 12bp wider. EU main CDS spreads were 0.5bp tighter and crossover spreads tightened 1.6bp. Asian equity markets have opened lower ~1% and Asia ex-Japan CDS spreads are tighter 1bp.

Macro; Rating Changes; New Bonds Commentary; Talking Heads; Top Gainers & Losers

US equities advanced as S&amp;P was 0.6% higher and Nasdaq over 1% higher. Utilities led the gains, up 1.4% followed by real estate up 1.2%. Financials and energy sectors fell 0.6% and 1.3% respectively. US 10Y Treasury yields eased by 4bp. European equities were 0.2-0.3% lower. US IG CDS spreads were 1.1bp tighter and HY was 0.9bp tighter. EU main CDS spreads were 0.2bp wider and crossover spreads widened 2.1bp. Asian equity markets have opened positive with gains of 0.4% and Asia ex-Japan CDS spreads are tighter by 1.3bp. Asian primary markets are seeing a busy day with five new dollar deals this morning.

US equities advanced as S&amp;P was 0.6% higher and Nasdaq over 1% higher. Utilities led the gains, up 1.4% followed by real estate up 1.2%. Financials and energy sectors fell 0.6% and 1.3% respectively. US 10Y Treasury yields eased by 4bp. European equities were 0.2-0.3% lower. US IG CDS spreads were 1.1bp tighter and HY was 0.9bp tighter. EU main CDS spreads were 0.2bp wider and crossover spreads widened 2.1bp. Asian equity markets have opened positive with gains of 0.4% and Asia ex-Japan CDS spreads are tighter by 1.3bp. Asian primary markets are seeing a busy day with five new dollar deals this morning.

Petronas, Hutchison Ports Launch $ Bonds; Macro; Rating Changes; New Bond Issues; Talking Heads; ...

S&amp;P ended Friday almost flat while Nasdaq slipped to end 0.6% lower after falling ~1.7% mid-day. US 10Y Treasury yields shot higher by 9bp to end at 1.62% on Friday. Mixed moves were also seen in European equities on Friday as the DAX and Eurostoxx fell 0.5% and 0.3% while FTSE and CAC ended 0.4% and 0.2% higher. US IG CDS spreads were 0.1bp wider and HY was 4.3bp tighter. EU main CDS spreads were 0.7bp wider and crossover spreads widened 4.9bp. Asian equity markets are lower 0.5%. Asia ex-Japan CDS spreads were up by 0.3bp.

GLP, Yango Launch $ Bonds; Macro; Rating Changes; New Bond Issues; Talking Heads; Top Gainers & L...

Singapore

iShares Barclays USD Asia High Yield Bond Index ETF is an exchange-traded fund incorporated in Singapore. The Fund seeks to track the performance of the Bloomberg Barclays Capital USD Asia High Yield Bond Index.

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Naver & JunFa Launch $ Bonds; Macro; Rating Changes; New Bond Issuances; Talking Heads; Top Gaine...

S&P ended flat on Friday while Nasdaq was 0.8% higher. The US 10Y Treasury yield was 2bp lower. Financials underperformed the index as the Fed...

BondEvalue

Bank Credit Weekly: Inflation, the Next Market Challenge or Opportunity?

The recent back-up in US rates may be an opportunity to reload in some Emerging Markets. A US inflation spike is the next hurdle. EM High Yield,...

Hank Calenti, CFA

Macro; Rating Changes; New Bonds Commentary; Talking Heads; Top Gainers & Losers

US equities fell yesterday with the S&P down 1.5% while the tech heavy Nasdaq slipped over 3%. Apple, Amazon and Netflix fell over 3.4%. The...

BondEvalue

Petronas, Hutchison Ports Launch $ Bonds; Macro; Rating Changes; New Bond Issues; Talking Heads; ...

US equities advanced as S&P was 0.6% higher and Nasdaq over 1% higher. Utilities led the gains, up 1.4% followed by real estate up 1.2%....

BondEvalue

GLP, Yango Launch $ Bonds; Macro; Rating Changes; New Bond Issues; Talking Heads; Top Gainers & L...

S&P ended Friday almost flat while Nasdaq slipped to end 0.6% lower after falling ~1.7% mid-day. US 10Y Treasury yields shot higher by 9bp to...

BondEvalue

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