Looks like the public bond market in Russia is sending a message … so turn it off!
Russia is selling notes directly to pension funds and banks for the first time in 1 1/2 years, sidestepping the bond market after four failed auctions since President Vladimir Putin’s incursion into Crimea.
The Finance Ministry is offering 100 billion rubles ($2.8 billion) of non-tradeable securities today, with half due March 2015 at a 7.73 percent yield and the rest maturing in February 2016 at 8.25 percent, it said on its website on March 26. The yield on government ruble bonds due January 2016 rose 190 basis points since the start of the year and was at 8.25 percent the day before the sale was announced.
By offering almost three times the amount auctioned this year in one day, Russia may be signaling it doesn’t foresee investor sentiment being restored anytime soon, according to BCS Financial Group and GHP Group. Russian borrowing costs rose to a record after Putin’s annexation of Ukraine’s Crimea peninsula sparked the worst standoff with the U.S. since the Cold War.
Yellen is showing her dovish side:
Federal Reserve Chair Janet Yellen said “considerable slack” in the labor market is evidence that the central bank’s unprecedented accommodation will still be needed for “some time” to put Americans back to work.
Large numbers of partly unemployed workers, stagnant wages, lower labor-force participation and longer periods of joblessness show that Fed officials must continue their easing, Yellen said today in remarks prepared for a speech in Chicago.
“This extraordinary commitment is still needed and will be for some time, and I believe that view is widely shared by my fellow policymakers at the Fed,” Yellen said in her remarks to a Fed community development conference. “The scars from the Great Recession remain, and reaching our goals will take time.”
I knew that mobile eMoney transactions were catching on in Africa … but I didn’t realize it was this big:
All the talk of bitcoin in recent years has overshadowed the real e-finance revolution: In Africa, India and now Eastern Europe, a service called M-Pesa has replaced banking for millions of people who don’t have or, in fact, even need a bank account.
Safaricom, Kenya’s leading mobile operator, majority-owned by a subsidiary of France’s Orange and operated by the U.K.’s Vodafone, introduced M-Pesa — mobile money in Swahili — in 2007. Soon the system had an agent in just about every village and every corner of Nairobi’s vast Kibera slum. Locals came to the agents with their phones — just plain old Nokias, not fancy smartphones — signed up and received a new menu from the operator, allowing one to transfer money to another mobile number. M-Pesa could be cashed at an agent’s — by sending a text message and receiving money then and there — and, eventually, at automated-teller machines, without the need for a debit card. Sending money to family in a remote part of the country or paying at a market stall was suddenly as easy as texting. Nobody was sending wads of Kenyan shillings on buses, hoping they would make it to relatives in Mombasa or Kitale, or carrying much cash around. M-Pesa was cheaper then a bank, and it was everywhere, with hand-painted signs for agents popping into view in the unlikeliest places.
…
About 43 percent of Kenya’s $40 billion gross domestic product flows through the system. And, speaking of Bitcoin, M-Pesa is far, far ahead of the fashionable digital currency in transaction numbers.
Brookfield Renewable Energy Partners L.P. had its outlook raised to ‘Positive’ by S&P:
- •We are revising our outlook on Brookfield Renewable Energy Partners L.P. (BREP) to positive from stable.
- •The outlook revision reflects the increasing amount of parent-only cash flow that the partnership is generating combined with a relatively modest level of parent only recourse debt.
- •We are also affirming our ratings on BREP and subsidiaries Brookfield Renewable Power Equity Inc. and BRP Finance ULC, including our ‘BBB’ long-term corporate credit rating on BREP.
Standard & Poor’s Ratings Services today said it revised its outlook on Brookfield Renewable Energy Partners L.P. (BREP) to positive from stable. At the same time Standard & Poor’s affirmed its ratings on BREP and subsidiaries Brookfield Renewable Power Equity Inc. and BRP Finance ULC, including its ‘BBB’ long-term corporate credit rating on BREP.
Brookfield Renewable Power Pref Eqty Inc is the proud issuer of BRF.PR.A, BRF.PR.C, BRF.PR.E and BRF.PR.F. S&P does not go so far as to say there is 100% correspondence between the parent company and its preferred issuer subsidiary, but I’d call it a pretty good bet.
The Canadian preferred share market closed the month on a happy note, with PerpetualDiscounts winning 10bp, FixedResets gaining 3bp and DeemedRetractibles up 4bp. Volatility was minimal. Volume was below average.
And that’s it for another quarter!
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.5152 % | 2,434.4 |
| FixedFloater | 4.68 % | 4.28 % | 38,099 | 17.74 | 1 | 0.1974 % | 3,626.3 |
| Floater | 2.99 % | 3.08 % | 49,855 | 19.50 | 4 | 0.5152 % | 2,628.5 |
| OpRet | 4.65 % | -0.21 % | 100,031 | 0.22 | 3 | 0.0129 % | 2,688.3 |
| SplitShare | 4.81 % | 4.34 % | 64,218 | 4.28 | 5 | -0.0874 % | 3,085.1 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0129 % | 2,458.2 |
| Perpetual-Premium | 5.63 % | -4.94 % | 91,537 | 0.09 | 11 | 0.0680 % | 2,367.7 |
| Perpetual-Discount | 5.43 % | 5.42 % | 121,557 | 14.56 | 26 | 0.1014 % | 2,457.0 |
| FixedReset | 4.70 % | 3.64 % | 219,935 | 4.41 | 79 | 0.0338 % | 2,517.7 |
| Deemed-Retractible | 5.05 % | 1.98 % | 159,086 | 0.16 | 42 | 0.0395 % | 2,473.8 |
| FloatingReset | 2.63 % | 2.61 % | 188,851 | 7.04 | 5 | 0.0321 % | 2,454.0 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| CIU.PR.C | FixedReset | 1.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-03-31 Maturity Price : 21.25 Evaluated at bid price : 21.53 Bid-YTW : 3.66 % |
| BAM.PR.K | Floater | 1.43 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-03-31 Maturity Price : 17.00 Evaluated at bid price : 17.00 Bid-YTW : 3.08 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| TRP.PR.A | FixedReset | 596,811 | Nesbitt crossed two blocks of 295,000 each, both at 23.30. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-03-31 Maturity Price : 22.60 Evaluated at bid price : 23.20 Bid-YTW : 3.92 % |
| RY.PR.X | FixedReset | 102,501 | TD crossed 60,000 at 25.66. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-08-24 Maturity Price : 25.00 Evaluated at bid price : 25.63 Bid-YTW : 1.52 % |
| BNS.PR.M | Deemed-Retractible | 81,961 | Nesbitt crossed blocks of 25,000 and 50,000, both at 25.65. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-07-27 Maturity Price : 25.50 Evaluated at bid price : 25.58 Bid-YTW : 2.32 % |
| NA.PR.S | FixedReset | 67,063 | YTW SCENARIO Maturity Type : Call Maturity Date : 2019-05-15 Maturity Price : 25.00 Evaluated at bid price : 25.36 Bid-YTW : 3.93 % |
| ENB.PF.A | FixedReset | 63,665 | Recent new issue. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-03-31 Maturity Price : 23.16 Evaluated at bid price : 25.10 Bid-YTW : 4.27 % |
| ENB.PR.P | FixedReset | 62,209 | Nesbitt crossed 53,400 at 24.27. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-03-31 Maturity Price : 22.87 Evaluated at bid price : 24.20 Bid-YTW : 4.24 % |
| There were 25 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| BNS.PR.L | Deemed-Retractible | Quote: 25.53 – 25.93 Spot Rate : 0.4000 Average : 0.2297 YTW SCENARIO |
| CU.PR.E | Perpetual-Discount | Quote: 23.40 – 23.70 Spot Rate : 0.3000 Average : 0.2040 YTW SCENARIO |
| PWF.PR.A | Floater | Quote: 19.26 – 19.99 Spot Rate : 0.7300 Average : 0.6413 YTW SCENARIO |
| ENB.PR.A | Perpetual-Premium | Quote: 25.27 – 25.55 Spot Rate : 0.2800 Average : 0.1948 YTW SCENARIO |
| ELF.PR.G | Perpetual-Discount | Quote: 21.29 – 21.61 Spot Rate : 0.3200 Average : 0.2404 YTW SCENARIO |
| W.PR.J | Perpetual-Discount | Quote: 24.56 – 24.85 Spot Rate : 0.2900 Average : 0.2114 YTW SCENARIO |