Amidst a global downturn in the resources sector, drilling company Boart Longyear (ASX: BLY) has suffered a challenging trading environment resulting in weak liquidity and profitability. In a bid to stay afloat and meet existing debt obligations, the company announced its intention to restructure its debt and capital last year. Earlier this month, BLY indicated that the recapitalisation plan had [...]
As we move into the new month, demand for corporate bonds remains strong. The balance has been skewed for most of 2017, with bonds being easy to sell but difficult to buy. But as primary supply has increased (mostly in institutional markets), this skew has eased slightly. This suggests that credit spreads are likely to trade in a tight range [...]
In another shortened (Easter) week for markets, global politics continue to dominate headlines. While some of the media spotlight has shone on the pending French election which is likely to have consequences for European Union stability, of greater importance are the forthcoming plans for the Trump Administration’s tax reform. A formal announcement is expected on Wednesday and will reveal how [...]
In a shortened (Easter) week for markets, Treasury bonds benefited from broad based risk-off sentiment last week as a result of geopolitical tensions. The 10-year Australian government bond saw its yield drop to 2.45%, touching the lowest level since November 2016. Last week, Standard and Poors released the "2016 Annual Global Corporate Default Study And Rating Transitions" report which is a [...]
Bond markets rallied (price up, yield down) last week following news that the US launched a cruise missile attack against Syria. Treasury yields fell on the headlines but this was partially offset by comments later in the week from the New York Federal Reserve President William Dudley downplaying any pause in short-term interest rate normalisation. The weak non-farm payrolls (employment) [...]
In recent years, there has been a clear global focus of Environmental, Social and Governance (ESG) standards. As a result, companies have become more ethically conscious and developed new initiatives to demonstrate this behaviour to investors. One such initiative has been the rapid rise of the Green Bond market which is estimated to be ~US$150 billion. These instruments are like [...]
Amidst decade-low uranium prices and over-supply of yellowcake (impure uranium oxide obtained during processing of uranium ore) Paladin Energy (ASX: PDN) announced an ambitious capital restructure plan earlier this year. The capital restructure proposed the exchange of its existing 2017 convertible bonds (US$212 million) and 2020 convertible bonds (US$150 million) into US$115 million of new secured bonds due 2022, US$102 million [...]
Equity and credit markets remained strong last week with the latter being more balanced as issuers responded to buy-side demand. There was marginal change in the swap curves but the yield on 10-Year Government Bonds continues to retrace lower given slightly lower inflation expectations. The recent failure of Trumps healthcare plan has arguably increased the possibility of tax reform in [...]
Last week marked a busy week for primary markets as issuers rush to secure funding before the Easter holiday period. In over-the-counter (OTC) markets there was new issuance from Credit Union Australia, AMP Bank and WSO Finance (a subsidiary of Transurban) with a number of companies remaining in the queue. In the high-yield space, IMF Bentham announced the launch of [...]
In our 2017 outlook, we stated our preference for direct securities over index strategies and that a higher yield curve would make it difficult for passive ‘long only’ strategies to outperform. This was the case in 2016 as many indices underperformed as long term interest rates rose on higher inflationary expectations. Table 1. Major Fixed Income Indices Returns Index 1 [...]
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An employee-owned financial services provider focused on the Debt Capital Markets.
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