US: Corporate Credit Update: Moving Higher as Stocks Extend Lows
Inside range for investment-grade corporate credit risk Thursday, mildly higher as equities extended session lows in the second half.
- Investment grade risk measured by Markit's CDXIG5 index inched +0.346 higher at 88.135 vs. 85.723 low (near Mon's 2Y high of 90.438); CDXHY5 high yield index at 100.143 (-0.279).
- Outperforming credit sectors (tighter or least wide): Energy (+1.0), Communications (+1.4), while debt holdings for Utilities, Industrials and Technology held (1.5)
- Lagging sectors (wider or least narrow): Financials subordinated (+3.4), Consumer discretionary (+2.9).
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US TSY OPTIONS: Large OTM 5Y Call Sale
- -30,000 FVK 115.5 calls, 1 ref 113-24.5
PIPELINE: John Deere, Ferguson Finance Launched
Well off Monday's pace after $12.75B Amazon 7pt jumbo pushed week opener issuance to $23.5B. IDB rolled to Wednesday, suspect balance of week to be thin ahead early Easter holiday close Thu, no trade Friday.
- Date $MM Issuer (Priced *, Launch #)
- 04/12 $600M #John Deere Capital 7Y +65
- 04/12 $1B #Ferguson Finance $300M 5Y +165, $700M 10Y +200
- Expected Wednesday:
- 04/13 $Benchmark IDB 3Y SOFR+35a
GBPUSD TECHS: Path Of Least Resistance Remains Down
- RES 4: 1.3439 High Feb 25
- RES 3: 1.3398 61.8% retracement of the Feb 10 - Mar 15 downleg
- RES 2: 1.3252/98 50-day EMA / High Mar 23
- RES 1: 1.3136/83 20-day EMA / High Mar 30
- PRICE: 1.3041 @ 16:04 BST Apr 12
- SUP 1: 1.2983 Low Apr 8
- SUP 2: 1.2954 1.764 proj of the Jan 13 - 27 - Feb 10 price swing
- SUP 3: 1.2933 Low Nov 5 2020
- SUP 4: 1.2855 Low Nov 2 2020 and a key support
GBPUSD remains vulnerable. The pair traded lower Friday, resulting in a print below key support at 1.3000, the Mar 15 low and a bear trigger. The move lower confirms a resumption of the primary downtrend and an extension of the recent pullback from 1.3298, the Mar 23 high. A continuation lower would open 1.2954, a Fibonacci projection level. Initial resistance is at 1.3125, the 20-day EMA ahead of the key 50-day EMA level at 1.3243.
