The Middle East cease fire has provided a window of opportunity for issuers to come to the market. The relative calm is enough to see a long list of deals over the last week. See the list at the end of the note.
According to Viktor Shvets from Macquarie Bank, stagflation is his base case scenario and the earliest we could see some relief is in 2Q27. We should expect combined slower economic growth, higher unemployment and rising prices. It’s very difficult to control stagflation as policies to improve growth and unemployment tend to add to inflation and vice versa. Stagflation is a significant concern. I’ve always liked Shvets’ insights, you can watch his brief but informative interview on CNBC.
If there’s one suggestion I’d give any investor, it’s to read widely and try and make up your own mind on what you think markets will do. So, reading BNP Paribas’ Chris Iggo’s latest note resonated. It’s fairly easy to imagine what will happen if the ceasefire holds but what happens if the conflict swings between ceasefire and prolonged attrition? Iggo contemplates a range of scenarios and what we should look for in bond and equity markets.
The world has changed. According to Laura Cooper from Nuveen, the Strait of Hormuz is not an aberration from a new geopolitical order, it is an expression of it. Cooper thinks markets are increasingly complacent and are not pricing in enough of the tail risks.
S&P Dow Jones Indices has announced a new credit default swap benchmark for private credit.
After last week’s note on how Betashares has restructured its previous hybrid focused, (ASX:HBRD) ETF, Daintree have announced its global hybrid ETF, (ASX:DHOF) will be revoked.
Here’s the latest on domestic corporate bond issuance:
- Air Services Australia has priced $500m six year senior unsecured bond at a 5.35% fixed rate
- AMP has printed a $200m senior unsecured one year floating rate note at 3 month BBSW + 80 basis points
- APA Infrastructure is sounding out investors on domestic senior and subordinated on:
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- Senior seven and a half or 10 year options
- Subordinated 30 years non call 7.5 or 30NC10
- Bendigo and Adelaide Bank has launched a three year senior unsecured fixed and or floating deal with price guidance of 88 basis points over swap
- Community First Bank has mandated a senior unsecured five or seven year fixed rate note
- Downer Group Finance has mandated a senior unsecured three year floating rate note
- Mirvac REIT has mandated a new senior unsecured domestic green bond:
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- five year fixed and or floating rate note
- seven year fixed
- Nomura has priced a five year $850m senior unsecured fixed rate bond at 6.17%
- Pacific Life has launched a five year fixed and or floating funding agreement backed kangaroo bond with price guidance of 110 basis points over swap
- Powerco has mandated a 10 year, fixed rate, senior secured green bond
- Scentre has launched a six senior fixed and or floating unsecured bond deal with price guidance of 130 basis points over swap
- Stockland has launched a seven and a half year, senior unsecured fixed rate bond deal with price guidance of 145-150 basis points over semi quarterly swap
- UBS has raised $2.75 billion in a senior unsecured multi tranche deal:
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- Three year floating rate note priced at 3 month BBSW + 73 basis points
- Five year floating rate note priced at 3 month BBSW + 86 basis points
- Five year fixed rate priced at 5.518%
Have a great week!
