Rates Market

• US Treasury prices are down heading into Friday’s close, off of the week highs yesterday.

• Yields are higher across the curve today, with the 10-year at 0.842%.  

• The spread between the 2-year and the 10-year yield narrowed to 67bps, with the 5-year & 30-year down to 117bps.

• Headlines remain focused on all COVID related updates, as emergency lending discussions between the Treasury department and the Fed continue.

Source: Bloomberg.

Corporate Market

• The corporate spread for the iShares iBoxx Investment Grade Corporate Bond ETF, LQD, was approximately -6 bps tighter this week.

• Investment Grade spreads are the tightest they’ve been since Feb. 2020.

• New deals and volume is expected to taper off as we head into the holiday week next week. The street is projecting zero to $5 billion of new debt.

• Year-to-date run rate: 58% ($1.7 trillion).

• Week-to-date: $39 billion vs $25-30 billion expected.

Source: Bloomberg.

Corporate New Issue Highlights

Allstate $1.2b Debt Offering in 2 Parts

• $600m 5Y Fixed (Dec. 15, 2025) at +37.5
• $600m 10Y Fixed (Dec. 15, 2030) at +65

TJX $1b Debt Offering in 2 Parts

• $500m Long 7Y Fixed (May 15, 2028) at +53
• $500m Long 10Y Fixed (May 15, 2031) at +73

Aramco $8b Debt Offering in 5 Parts

• $500m 3Y Fixed (Nov. 24, 2023) at +110
• $1b 5Y Fixed (Nov. 24, 2025) at +125
• $2b 10Y Fixed (Nov. 24, 2030) at +145
• $2.25b 30Y Fixed (Nov. 24, 2050) to Yield 3.3%
• $2.25b 50Y Fixed (Nov. 24, 2070) to Yield 3.65%

American Tower $1.7b Debt Offering in 3 Parts

• $500m 3Y Fixed (Jan. 15, 2024) at +43
• $650m 7Y Fixed (Jan. 31, 2028) at +87.5
• $550m 30Y Fixed (Jan. 15, 2051) at +137.5

Muni Market

• Municipals outperformed Treasuries for the week with the AAA yield curve flattening approx. 10bps.

• Municipal mutual funds added $1.3 billion in inflows for the week ending 11/18.

• Supply/demand dynamics remain supportive with 30-day visible supply of $6.87 billion vs $24.7 billion of redemptions.

• Issuance next week is expected to be $2.99 billion. Notable deals include; JFK International Air Terminal $1.01 billion, San Francisco Community College $550 million, Denton Independent School District $269.4 million.

Source: Bloomberg.