PRINTEDûmATûTOûFAIRûVALUEûANDûATûTHEûTOPûENDû
of its size ambitions.
The US REIT began marketing at 115bp-
BPûOVERûMID
SWAPS ûBEFOREûCUTTINGû
pricing by 15bp and then launching at the
TIGHTûENDûOFûTHATûREVISEDûRANGE
It has June 2026s issued through a US
ENTITY ûWHICHûWEREûATûSWAPSûPLUSûBPûPRE
MANDATE ûWHILEûAû-ARCHûû'REENûBONDû
FROMûAû%UROPEANûENTITYûWASûATûBP û
according to Tradeweb prices.
!NûEXTRAPOLATIONûOFûTHOSEûTWOûSUGGESTEDû
FAIRûVALUEûJUSTûINSIDEûBP ûWITHûAûBANKERû
AWAYûAGREEINGûAûNUMBERûAROUNDûTHATûLEVELû
too.
h4HEûSTARTINGûLEVELûSEEMSûPRETTYûPUNCHYû
BUTû)MûSUREûITLLûGOûVERYûWELL vûTHEûBANKERû
said early in the session.
h4HERESûBEENûVERYûLITTLEûSUPPLYûAPARTû
from real estate and the technicals seem
VERYûSTRONGûTODAYû)TSûQUIET ûYETûINVESTORSûAREû
AROUNDûANDûTHEYVEûGOTûCASHûTOûPUTûTOûWORKû
Prologis has timed its deal fantastically
WELLv
)TSûRATINGSûAREûALSOûAûDRAWû0ROLOGISûISû!!
û
BYû-OODYS30 ûWITHûAûLEADûSAYINGûITûISûONEû
OFûTHEûFEWû3INGLEû!ûREALûESTATEûCOMPANIESû
Unibail-Rodamco and Klepierre are two
others.
)SSUERSûFROMûTHEûSECTORûHAVEûPUMMELLEDû
THEûPRIMARYûMARKETûTHISûYEARûANDûHAVEû
INTENSIlEDûTHEIRûASSAULTûOVERûTHEûPASTû
MONTH ûWITHûEIGHTûBONDSûPRICING
ADO PROPERTIES ûHOWEVER ûHASûYETûTOûHITûSCREENSû
DESPITEûlNISHINGûITSûROADSHOWûOVERûûDAYSûAGOû
FORûTHEûNO
GROWûõMûCIRCAûEIGHT
YEARûTRADEû!û
lead said the company was letting people digest
news that the chairman of one of itsSHAREHOLDERS ûANDûALSOûOFû!$/ûITSELF ûHADûBEENû
detained for questioning by Israeli authorities.
2EALûESTATEûSUPPLYûISûEXPECTEDûTOûCONTINUEû
INûTHEûSECONDûHALF ûALBEITûATûAûLESSERûPACEû
GIVENûTHEûANTICIPATEDûSLOWDOWNûINû-! û
according to a BNP Paribas research note.
0ROLOGIS ûWHICHûPLANSûTOûUSEûTHEûPROCEEDSû
FORûGENERALûCORPORATEûPURPOSES ûOPERATESû
ACROSSûTHEû!MERICAS û%UROPEûANDû!SIABond investors not taking
Trump’s word on tariffs
US CORPORATES/HIGH-YIELD Market placing low probability on full implementationThere is a good reason corporate bond investors
have been reluctant to price in the impact of
US President Donald Trump’s proposed tariffs
on US$200bn of Chinese imports - they are
sceptical they will ever materialise.
Current US corporate bond valuations suggest
market participants are placing a low probability on
an escalation of trade skirmishes between the US
and its main trading partners, according to analysts.
“The market sides with the view that full
implementation (of the announced tariffs) is
unlikely,” Oleg Melentyev, head of high-yield
and leveraged loan strategy at Bank of America
Merrill Lynch, told IFR.
“You could describe it as complacency, but my
personal view is that it is the right position.”
The market may be right, as Trump has backed
away from his harsh rhetoric on more than one
occasion.
After criticising the European Union’s trade
policy for months and labelling the block a “foe”,
Trump gave way at a meeting with European
Commission President Jean-Claude Juncker on
Wednesday.
The two said they agreed to hold talks to
reduce tariffs and non-tariff barriers acrossseveral industries, sending stocks and the
euro higher. Juncker said they also agreed to
refrain from imposing new tariffs while talks are
underway.
The view from some analysts and investors is
that a similar relaxation of tensions with China
could also be on the cards.
Trump has pledged to drastically reduce the
United States’ trade deficit with China. Earlier
this month, his administration imposed duties
on US$34bn of Chinese imports, prompting
retaliatory tariffs from China.
Raising the stakes of the confrontation, US
officials on July 10 announced plans to slap a
10% tariff on US$200bn of additional Chinese
imports.
Since then, Trump has said he is ready to
impose tariffs on all US$500bn of Chinese
imports.
A confrontation with China of that magnitude
would likely push corporate bond spreads way
above their current levels, as investors would start
getting more nervous about the risk of a global
recession, say analysts.
According to UBS analysts, average spreads
over Treasuries of junk-rated corporate bondsALL INVESTMENT-GRADE BONDS IN EUROS
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues €(m) (%)
1 BNP Paribas 145 39,935.29 7.2
2 SG 139 36,568.06 6.6
3 HSBC 169 36,165.67 6.6
4 Credit Agricole 128 34,254.03 6.2
5 JP Morgan 112 33,849.07 6.1
6 Deutsche Bank 135 31,610.10 5.7
7 Barclays 98 31,057.61 5.6
8 UniCredit 125 27,393.72 5.0
9 Goldman Sachs 71 26,987.48 4.9
10 Citigroup 81 22,184.68 4.0
Total 723 551,055.22
Excluding ABS/MBS, equity-related debt.
Source: Thomson Reuters SDC code: N9
ALL CORPORATE BONDS IN STERLING
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues £(m) (%)
1 Barclays 10 1,333.17 16.2
2 HSBC 10 1,330.09 16.2
3 Lloyds Bank 8 1,028.98 12.5
4 Morgan Stanley 4 538.57 6.5
5 RBC 3 496.43 6.0
6 BNP Paribas 6 467.04 5.7
7 MUFG 4 328.21 4.0
8 NatWest Markets 4 321.85 3.9
9 Santander Global 3 254.66 3.1
10 Credit Suisse 4 250.00 3.0
Total 27 8,228.70
Source: Thomson Reuters SDC code: N8a
ALL SWISS FRANC BONDS EXCLUDING
SECURITISATIONS
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues SFr(m) (%)
1 UBS 74 8,545.89 27.4
2 Credit Suisse 77 8,471.83 27.1
3 Verband Schweizerischer 10 3 ,838.82 12.3
4 ZKB 34 3,493.89 11.2
5 Raiffeisen Schweiz 22 1,932.24 6.2
6 BNP Paribas 14 1,387.35 4.4
7 Deutsche Bank 9 867.55 2.8
8 Commerzbank 8 699.25 2.2
9 HSBC 5 435.63 1.4
10 Bank Vontobel 1 225.00 0.7
Total 145 31,214.88
Including preferreds. Excluding equity-related debt.
Source: Thomson Reuters SDC code: K06bALL INTERNATIONAL STERLING BONDS
EXCLUDING SECURITISATIONS
BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share
bank or group issues £(m) (%)
1 HSBC 66 10,666.79 14.0
2 NatWest Markets 59 8,855.15 11.7
3 Barclays 53 7,479.38 9.8
4 RBC 41 5,894.29 7.8
5 Lloyds Bank 36 5,423.60 7.1
6 BAML 22 3,681.53 4.8
7 Santander Global 17 3,309.28 4.4
8 JP Morgan 15 3,249.95 4.3
9 Nomura 25 3,181.33 4.2
10 Deutsche Bank 14 3,080.36 4.1
Total 187 75,971.37
Including preferreds. Excluding equity-related debt.
Source: Thomson Reuters SDC code: K05a