CREDIT MARKETS

Treasuries:
Treasury prices declined Thursday, sending yields higher for a fourth consecutive session, as the government completed the last of the week’s three record-sized note auctions. Growing government debt issuance is in sharp focus as President Barack Obama released his budget for fiscal 2010 and predicted a yawning $1.75 trillion federal deficit. In the first sale of 7-year notes since 1993, the Treasury Department sold $22 billion to yield 2.748 percent. Bidders offered $2.11 for every dollar available. Indirect bidders, a class of investors that includes foreign central banks, bought 38.7 percent of the notes up for bid. The return of a long-retired maturity is part of the government’s plan to increase bond issuance to finance all of the programs and stimulus enacted by the Federal Reserve and Congress in the hopes of stabilizing financial markets and helping bring the recession to an end.

First-time applications for state unemployment benefits rose 36,000 last week, reaching a seasonally adjusted 667,000, the highest since October 1982. And for the week ended Feb. 14, the number of people collecting benefits climbed to a record 5.11 million. February is, so far, the third-busiest month on record for the issuance of corporate bonds. Economic news will focus on University of Michigan and consumer of confidence.

Commentary/New Issues

Corporate:
$5.0 BLN, Chevron Corp., Aa1/AA, 3 part $1.5 BLN, 3.45%, 3/3/2012, +195bp; $2.0 BLN, 3.95%, 3/3/2014, +195bp; $1.5 BLN, 4.95%, 3/3/2019, +195bp $3.0 BLN, Abbott Labs, A1/AA, 2 part $2.0 BLN, 5.125%, 4/1/19, +220bp; $1.0 BLN, 6.00%, 4/1/39, +235bp $500 MM, Alabama Power, 6.00%, 3/01/39, A2/A, +235bp

ABS:
Nothing

Agency:
$15 BLN, FNMA, 1.75%, 3/23/11, +68bp

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS

Treasuries:
Treasury prices moved lower Wednesday, pushing yields higher for a third day, as the government sold a record amount of 5-year notes, the second in a trio of U.S. auctions flooding the bond market with fresh supply this week. The Treasury Department sold $32 billion in 5-year notes to yield 1.985 percent. Investors bid $2.21 for every dollar of the notes up for sale, the most since November. Indirect bidders, a class of investors that includes foreign central banks, took 48.9% of the sale, the most since September 2006. On Thursday, the government will sell $22 billion in 7-year notes. That sale is creating the most uncertainty for traders because the maturity hasn’t been offered since 1993, raising questions about how much demand it will garner from investors. Existing-home sales dropped 5.3% to a seasonally adjusted annual rate of 4.49 million in January, the lowest sales pace in 12 years and worse than economists expected. Economic news tomorrow will focus on new home sales, initial jobless claims and durable good orders.

Commentary/New Issues

Corporate:
$1.0 BLN, Pepsico, 3.75%, 3/1/14, Aa2/A, +180bp $850 MM, Avon Products, A2/A, 2 part $500 MM, 5.625%, 3/1/14, +375bp; $350 MM, 6.50%, 3/1/19, +375bp $500 MM, Nevada Power, 7.125%, 3/15/19, Baa3/BBB, +425bp

ABS:
Nothing

Agency:
Nothing

All statistical data is sourced from Bloomberg Financial Markets New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS

Treasuries:
Treasury notes fell for the first time in three days as stocks rallied and the government prepared to sell $54 billion of new debt following a $40 billion auction of two year notes. Earlier, bonds had mostly been higher as Federal Reserve Chairman Ben Bernanke said that the bigger risks to the U.S. economy remain on the downside and that the government’s actions taken to fix banks and financial institutions will take time to work. The new 2-year notes were priced to yield 0.961 percent. Bidders offered $2.63 for every dollar available, better than the $2.35 average of the last four auctions. On Wednesday, the government will sell $32 billion in 5-year notes followed by $22 billion in 7-year debt on Thursday, the first sale for this maturity since 1993. Equities also recovered as the day went on, to the detriment of bonds. If the Obama administration and the Fed are successful in their strategy for restoring some measure of bank stability, “there is a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery,” Bernanke said in testimony on monetary policy. Economic news tomorrow will focus on existing home sales.

Municipals:
Colorado’s Boulder Valley School District led auctions of U.S. fixed-rate municipal bonds as benchmark tax-exempt yields rose for a fourth day. The Boulder, Colorado, system sold $177 million of general obligation bonds today to finance two replacement schools and other improvements through Bank of America Corp.’s Merrill Lynch & Co., the bidder that offered the lowest interest cost. New York City, the week’s largest municipal borrower, continued taking orders from individual investors for a $520 million debt sale run by Citigroup Inc. and set to conclude tomorrow. Tax-exempt bonds slid as investors balked at yields that fell below 2 percent on securities due in the next five years. Ten-year AAA yields rose two basis points, or 0.02 percentage point, to 3.37 percent today, the highest in three weeks. The entire yield curve shifted 1-2 bpts higher.

Commentary/New Issues

Corporate:
$1.0 BLN, Noble Energy, 8.25%, 3/1/19, Baa2/BBB, +550bp
$250 MM, Vanderbilt University, 5.25%, 4/1/19, Aa2/AA, +250bp

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS

Treasuries:
Treasury prices posted slight gains Monday, erasing earlier losses, as stocks compounded their losses while investors fretted about how the government will support financial institutions. Treasuries rose for a second day as concern that deepening recession will erode company earnings drove investors toward the safest of assets. Thirty year bonds gained before Federal Reserve Chairman Ben Bernake tomorrow starts two days of congressional testimony on the economy. The U.S. is set to sell $94 billion of two, five and seven year notes this week. The difference between yields on the two and ten year notes narrowed to 1.83 percentage points, from 1.97 percentage points two weeks ago.  The Standard & Poor’s 500 Index lost 3.5 percent to its lowest close since April 1997.  The six day losing streak in the U.S. stock benchmark ranks as its longest since October. For all the $9.7 trillion pledged by the U.S. to combat the financial crisis, money markets show the world’s biggest banks see no recovery before 2010.

Municipals:
New York City leads state and local governments planning to sell about $3.8 billion of fixed-rate bonds as borrowing slows from last week’s pace amid higher benchmark yields. New York, the largest borrower among U.S. cities, will offer $400 million of tax-exempt and $120 million of taxable bonds in a sale managed by Citigroup Inc. The University of Pittsburgh and CPS Energy in San Antonio each also intend to borrow more than $400 million this week.  Municipal bonds declined last week by the most since January amid concerns the $787 billion economic stimulus package wouldn’t aid state and local governments as much as expected, also, “crossover” investors who bought debt when it was cheaper unwound trades. The market has a bit of indigestion combined with renewed credit concerns.  Yields on top-rated 30-year general obligation bonds last week rose six basis points, or 0.06 percentage point, to 5.18 percent, the highest since Feb. 3.  With last week’s declines, tax-exempt bonds have returned 1.1 percent for the month and 5.2 percent in 2009, including reinvested interest compared to Treasuries have lost 2.7 percent and corporate bonds gained 0.4 percent. The final read on the MMD was as follows 2010-2015 yields were higher by 2-3bpts; 2016-2019 yields were higher by 3-5 bpts; 2020-2039 yields were higher by 2-3 bpts.
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Commentary/New Issues

Corporate:
$2.775 BLN, Hewlett-Packard, A/A, 3 part $275 MM, 2/24/11, +3ML+175bp; $1.0 BLN, 4.25%, 2/24/12, +295bp; $1.5 BLN, 4.75%, 6/02/14, +295bp $800 MM, Waste Management, Baa3/BBB, 2 part $350 MM, 6.375%, 3/11/15, +462.5bp; $450 MM, 7.375%, 3/11/19, +462.5bp $500 MM, Arizona Public Service, 8.75%, 3/1/19, Baa2/BBB-, +595bp

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS

Treasuries:
Treasuries remained mostly under pressure as their yields rose Wednesday, after minutes of the Federal Reserve’s latest meeting showed central bankers saw the recession worsening in January but provided few specifics on possible purchases of Treasuries.  The Fed updated its economic forecasts, predicting that the economy would likely shrink between 1.3% and 0.5% this year, and grow about 2.5% to 3.3% in 2010. The Fed also said consumer prices would likely rise 0.3% to 1% this year. Wednesday’s selling in government bonds was also attributed to profit-taking after the previous session’s strong gains. Investors also sold government bonds ahead of announcements, due on Thursday, about what are already expected to be huge auctions of two-, five- and seven-year notes next week. The government will sell $41 billion in two-year notes, $31 billion in five-year notes and $25 billion in seven-year notes next week.  Economic news tomorrow will focus on PPI, initial jobless claims and leading indicators.

Municipals:
The Georgia State Road and Tollway Authority plans to complete the week’s largest U.S. municipal bond offering as benchmark tax-exempt borrowing costs remain near a two-decade low. The Georgia agency is selling $600 million of bonds backed by federal highway aid rated Aa3 by Moody’s Investors Service to fund projects for relieving congestion.  Underwriters led by Barclays Plc will take orders from institutions such as funds and insurers today, after selling “about a third” of the deal to individual investors yesterday, said Cherie Gibson, spokeswoman for the Atlanta-based authority. “Demand was especially strong from trust funds and investment advisers buying on behalf of retail.”

Yields on five-year, Aa3 state and local government bonds were 2 percent yesterday, close to the record low of 1.95 percent reached Feb. 5.  Tax-exempt debt edged lower as some buyers balked at yields that dropped more than two percentage points in four months.  “Demand should be resilient enough to keep yields generally range bound in the near term.”

Since December, municipal securities have outperformed Treasuries by the most on record. Investors sought tax-exempt yields exceeding their taxable counterparts as the U.S. moved to boost borrowing to pay for stimulus and financial bailout programs. The final read on the MMD was: 2010-2013 yields were higher by 2-3 bpts; 2014-2015 yields were lower by 4 bpts; 2016-2039 yields were lower by 1-3 bpts.

Click on chart to view larger:

Commentary/New Issues

Corporate:
$16 BLN, Roche Holdings, Aa1/AA-, 6 part  $3 BLN, 1YR, 3ML+100bp; $750 MM, 2YR, 3ML+200bp; $2.5 BLN, 3YR, +335bp; $2.75 BLN, 5YR, +335bp; $4.5 BLN, 10YR; +345BP; $2.5 BLN, 30YR, +365BP $300 MM, Goodrich Corp., 6.125%, 3/1/19, Baa2/BBB+, 350bp $550 MM, Canadian Nat’l Rlwy, 5.55%, 3/1/19, A3/A-, +295bp

ABS:
Nothing

Agency:
$10 BLN, Freddie Mac, 2.125%, 3/23/12, +88bp $250 MM, FHLMC, 3.375%, 2/27/14, at par

New Issues larger than $250mm.   The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.

All statistical data is sourced from Bloomberg Financial Markets.

CREDIT MARKETS

Treasuries:
Treasury prices jumped Tuesday, pushing yields down by the most since early December, as worries about European banks’ exposure to Eastern Europe and concerns about Ireland’s financial stability had investors clamoring for the relative safety of U.S. government debt.  The flight-to-safety rally in Treasuries coincided with heavy selling in U.S. equities. Helping set the trading tone was a report released overnight by Moody’s Investors Service in which the rating agency noted that Eastern European countries “have now entered a deep and long economic downturn.”  Bond traders also digested a Federal Reserve survey of manufacturing in the New York state area that showed factory activity continuing to contract in the region. The Empire State survey plunged to -34.7 in February from -22.2 in the previous month.  Economic news tomorrow will focus on housing starts, building permits and industrial production.

Municipals:
Municipal bonds didn’t match gains in U.S. Treasuries today as tax-exempt borrowers led by the Georgia State Road and Tollway Authority began this week’s debt sales, set to total about $4.5 billion.  The Georgia transportation agency and at least three of the week’s other largest issuers—Massachusetts, Connecticut and New York City’s Municipal Water Finance Authority total almost $2 billion—took orders from individual investors, Municipal Market Advisers said. Yields on 30-year AAA general obligation bonds held at 5.12 percent, after rising for the first time in almost three weeks Feb. 13. The MMD was unchanged.  The secondary market was very light.  I saw not two-sided markets but was posted on several trades.  I was posted on PR Cmwlth 5.5% 7/19 @ 99.00, PR Muni Fin Agy 5% 8/27 @ 98.50.
Click on chart to view larger:

Commentary/New Issues

Corporate:
$1.5 BLN, Honeywell, A2/A, 2 part $600 MM, 3.875%, 2/15/14, +225bp; $900 MM, 5.00%, 2/15/19, +237.5bp
$900 MM, DuPont, A2/A, 2 part  $400 MM, 4.75%, 3/15/15, +312.5bp; $500 MM, 5.75%, 3/15/19, +312.5bp
$750 MM, Union Pacific Corp., Baa2/BBB, 2 part  $350 MM, 5.125%, 2/15/14, +345bp; $400 MM, 6.125%, 2/15/20, +350bp
$600 MM, Coca Cola Enterprises, A3/A, 2 part $350 MM, 3.75%, 3/1/12, +258bp; $250 MM, 4.25%, 3/1/15, +270bp

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm.   The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.

All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS

Treasuries:
Treasuries declined Friday, pushing yields up, as traders watched Congress’ progress toward passage of the $789 billion stimulus package.  Expectations of more spending by the government to encourage economic growth and curb declines in the housing market raise concerns that even more debt will have to be sold, which would reduce the value of existing Treasuries. The market already expects to absorb more than $2 trillion in Treasuries this fiscal year. Traders were also focused on a program under consideration by the Obama administration to subsidize mortgage payments for troubled homeowners, subject to an affordability test. The University of Michigan index fell in February to one of the weakest reading on record, the index fell to 56.2 from 61.2 in January.  The markets were closed on Monday in observance of the Presidents Day holiday.
Click on chart to view larger:

Commentary/New Issues

Corporate:
Nothing

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.

All statistical data is sourced from Bloomberg Financial Markets

Type: Series 2009 A-1/A2 NR/AA

Amount: $237,980,000

CREDIT MARKETS

Treasuries:
Treasury prices rose Thursday, pushing yields lower, after a government report showed continuing stress in U.S. employment and amid rising concern that lawmakers’ plan to stimulate the economy will not be effective.
U.S. government debt briefly pared gains after the Treasury sold $14 billion in 30-year bonds, finishing off the massive amount of debt sold this week in the government’s quarterly refunding. Earlier Thursday, jobless claims declined by 8,000 to 623,000 in the week ended Feb. 7. Continuing claims, an indication of the difficulty of finding a new job, reached a record 4.81 million. Retail sales unexpectedly rose in January, up 1 percent from December. Excluding automobiles, sales unexpectedly rose 0.9 percent. Economists attributed the gain in part to seasonal factors, while also noting that figures for the previous two months were revised lower. In the Treasury’s auction of 30-year bonds, bidders offered $2.02 for every dollar available, compared to an average of $2.19 at the last 10 auctions. Indirect bidders, purchased 33.9 percent of the offering, compared to an average of 23.7 percent over that span.

Municipals:
Texas A&M University System led tax-exempt borrowers today in the U.S. as a two-month drop in short-term yields tempers demand from individual investors. Longer-term state and local bonds performed better than short-term securities today. Yields on benchmark debt due in less than 10 years, favored by so-called retail buyers, have fallen about two percentage points the past four months, Yields on 30-year AAA general obligation bonds fell two basis points, or 0.02 percentage point, to 5.09 percent today, the lowest in four weeks, according to a daily survey by Concord, Massachusetts-based Municipal Market Advisors. The 10-year yield gauge held at 3.28 percent, the lowest since January 2008. The final read on the MMD was as follows 2010-2020: yields were lower by 1 bpts; 2021-2039 yields were lower by 2 bpts.
Click on chart to view larger:

Commentary/New Issues

Corporate:
$1.25 BLN, Cox Communications, 8.375%, 3/1/39, Baa3/BBB-, +490bp

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.

All statistical data is sourced from Bloomberg Financial Markets

CREDIT MARKETS
Treasuries:
Long term treasuries gained Wednesday, with lack of confidence in government plans to tackle the credit crisis pushing yields down for a second day, even as the U.S. Treasury auctioned the largest amount of 10-year notes ever.  Bond yields fell by the greatest amount in at least two months Tuesday after Treasury Secretary Timothy Geithner announced his plan to use mostly private money to create a fund of at least $500 billion to recapitalize banks and another fund of $1 trillion to support consumer and business lending. The Treasury sold a record $21 billion of 10-year securities at a yield of 2.818 percent.  Bidders offered $2.21 for every dollar available, compared with an average of $2.34 at the last four auctions of new notes. Indirect bidders, a class of investors that includes foreign central banks, bought 37.8 percent of the sale, the highest in a year. Concerns have run especially high in the last week that China, the single largest holder of Treasuries, will keep buying, even though some of the biggest Treasury dealers say there have been no signs of a decline.  The government plans to finish its refunding operations Thursday with the sale of a record $14 billion in long bonds.

Municipals:

Tax-exempt borrowers plan to sell about $4.5 billion of fixed-rate bonds this week, compared with last year’s weekly average of $5.4 billion and last week’s $5.2 billion total. New York’s Metropolitan Transportation Authority $150M, Duke $249M, Mecklenburg County $244M. yields on AAA general obligation bonds due in 10 years eased one basis point, or 0.01 percentage point, to 3.28 percent, matching the low last reached Jan. 23, 2008.  The average seven-day yield for money funds that invest in tax-free and municipal debt fell to a record 0.28 as Tax-free money funds, which invest in the highest quality securities, have grappled with a shortage of acceptable debt after last year’s credit rating reductions at insurers and banks reduced the suitable supply. The final read on the MMD was as follows 2011-2019: yields were lower by 1 bpts; 2020-2039 yields were lower by 2-3 bpts.  NYC GO, NYC Waters and NYS Thruway will be accessing the capital markets next week.   Secondary market activity was fairly. There were a few tow-sided markets and no trades. I was in touch with MTA’s5 1/8 31 ata 5.24-5.22, PR GO FSA 5.25 27 ata 98.75-99.00.

Click on chart to view larger:

Commentary/New Issues

Corporate:
$1.5 BLN, Marathon Oil, Baa1/BBB+, 2 part  $700 MM, 6.50%, 2/15/14 +487.5bp; $800 MM, 7.50%, 2/15/19, +487.5bp $1.5 BLN, United Mexican States, 5.875%, 2/17/14, Baa1/BBB+, +425bp $1.0 BLN, MetLife, 7.717, 2/15/19, A2/A, +490bp

ABS:
Nothing

Agency:
Nothing

New Issues larger than $250mm.   The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offering mentioned and therefore offerings will be subject to availability.

All statistical data is sourced from Bloomberg Financial Markets