CREDIT MARKETS
Treasuries:
Treasury prices gained ground Tuesday, recovering from earlier losses, amid rising concerns that the rally in equities may be ending, increasing the appeal of U.S. debt as an alternative asset. Bonds were also supported by the Federal Reserve’s purchase of short-term debt. The U.S. central bank bought $6.007 billion in bonds maturing 2012 and 2013 during the Tuesday session–the second of three such operations scheduled for this week, part of the Fed’s plan to buy $300 billion in Treasuries by autumn to keep a lid on lending rates. Bonds started the U.S. session in the red, as traders digested Fed Chief Ben Bernanke’s remarks that he’s encouraged by the response to “stress tests” for 19 major financial institutions recently administered by the government. He said the bank’s response will have the effect of boosting confidence in the financial sector. Treasuries also played off a government report showed the U.S. trade deficit for March widened to $27.6 billion, an amount not as large as some economists had been looking for. The smaller deficit will make the first-quarter gross domestic product reading less negative. The financial health of Social Security and Medicare, the two main safety nets for American retirees and the elderly, is declining as the recession cuts payroll tax contributions just as the baby-boom generations begins to retire. Economic news for tomorrow will highlight retail sales and business inventories.
Commentary/New Issues
Corporate:
$750 MM, Sempra Energy, 6.50%, 6/1/16, Baa1/BBB+, +387.5bp
$750 MM, Occidental Petroleum, 4.125%, 6/1/16, A2/A, +160bp
$500 MM, Illinois State Toll Highway Authority, Aa3/AA-, 2 part $100 MM, 5.293%, 1/1/24, +210bp; $400 MM, 6.184%, 1/1/34, +200bp
$425 MM, Ameren Corp, 8.875%, 5/15/14, Baa3/BB+, +698.2bp
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.