BASIC INDUSTRIES: Smurfit Westrock (SW): 1Q25 Results Headlines

• Date $MM Issuer (Priced *, Launch #)
• 04/01 $1B *DBJ 5Y SOFR+59
• 04/01 $850M #Kommunalbanken Norway 4Y SOFR+41 (upsized from $500M)
• 04/01 $500M Nexa WNG 12Y +250
• 04/01 $Benchmark LPL Holdings 3Y +135a, 5Y +150a, 10Y +187a
• 04/01 $Benchmark Realty Income 10Y +145a
• 04/01 $Benchmark NRW Bank 5Y SOFR+49a

Natixis note that “the consequences of the Le Pen judgment on the French political landscape are still difficult to predict, but recent polls suggest her ineligibility for the next presidential elections would not be a disadvantage for the National Rally”.

• They maintain their end ’25 10-Year OAT/Bund target at 70bp, with the “risk of snap elections after the summer and uncertainties surrounding the 2026 budget” risking a move to 75-80bp over that horizon.

ISM Manufacturing printed the lowest reading in 4 months in March, falling to 49.0 from 50.3 prior (49.5 expected). This was a very weak report that can be partly attributed to volatility in the data, including front-loading activity in prior months ahead of anticipated tariffs, but forward looking indicators look poor. Additionally, price pressures are mounting for manufacturers.

• New Orders (45.2, lowest since May 2023, vs 48.2 expected, 48.6 prior) and Employment (44.7 vs 47.3 expected, 47.6 prior) dropped more than expected.
• Both subindices have fallen for two consecutive months (In January, New Orders was 55.1 and Employment was 50.3).
• Worryingly, new orders minus inventories (53.4) fell to -8.2, the lowest since May 2020. This has historically been a leading indicator, though clearly there are large tariff-related distortions (the report: "panelists’ companies continue to pull forward (advance) deliveries of materials in an attempt to minimize the financial impacts of potential tariffs").
• Export orders slipped to 49.6, a 4-month low, while supplier deliveries dipped 1 point to 53.5.
• The ISM report points out: "Slower supplier deliveries and expanded inventories in March are not considered positives for the economy: Both conditions figure to be temporary and are driven by tariff concerns, either delaying buyer/seller negotiations or advancing material deliveries that will be reversed after tariffs are deployed, leading to a drawdown of manufacturing inventory. "
• Meanwhile, Prices Paid jumped 7 points to a 33-momnth high 69.4 (64.6 expected). The report noted that almost all products (including, in tariff-related news, aluminum and steel) had risen in price, whereas just two had fallen in price (Industrial Alcohols; and Natural Gas).
• MNI had pointed out that regional Fed manufacturing surveys had been pointing to a much more significant jump in ISM Prices Paid than consensus had expected.