{"id":15602,"date":"2011-07-06T22:54:56","date_gmt":"2011-07-07T02:54:56","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=15602"},"modified":"2011-07-06T22:54:56","modified_gmt":"2011-07-07T02:54:56","slug":"july-6-2011","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=15602","title":{"rendered":"July 6, 2011"},"content":{"rendered":"

Portugal’s downgrade is contagious<\/a>:<\/p>\n

Portugal\u2019s downgrade to junk may stifle corporate bond sales in Europe, killing off a mini- revival in issuance spurred by investor optimism about Greece\u2019s efforts to avoid default.<\/p>\n

\u201cThe primary window has almost slammed shut just as spectacularly as it had flung open,\u201d said Suki Mann, senior credit strategist at Societe Generale SA in London.<\/p>\n

Notes sold by Enel SpA (ENEL), Italy\u2019s largest power operator, and Fiat SpA (F) fell in their first day of trading today, while two issuers pulled deals. Enel and Fiat led 5.4 billion euros ($7.7 billion) of company bond sales in Europe this week, the biggest round of issuance by non-financial borrowers since May, according to data compiled by Bloomberg.<\/p><\/blockquote>\n

Ireland may be next<\/a>!<\/p>\n

Ireland\u2019s credit rating may be cut to junk by Moody\u2019s Investors Service after Portugal yesterday lost its investment grade rating, according to analysts.<\/p>\n

Moody, which slashed Portugal to Ba2 from Baa1, in April lowered Ireland\u2019s credit rating to the lowest investment grade Baa3 and left country\u2019s outlook on negative.<\/p>\n

The ratings company cut Portugal\u2019s rating in part because the nation may not be able to return to debt markets in the second half of 2013. Ireland has been locked out of markets since September, and the yield on 10-year Irish bonds climbed to 12.44 percent today, a euro-area record for the country that agreed to a rescue package with the European Union and International Monetary Fund last November.<\/p><\/blockquote>\n

Synthetic ETFs are really getting a working-over<\/a>:<\/p>\n

U.K. fraud prosecutors are reviewing how exchange-traded funds are marketed and whether they have the proper tools to prosecute any wrongdoing in the industry, a person directly involved with the probe said.<\/p>\n

The Serious Fraud Office, which prosecutes white collar crime, hired a consultant to interview bankers and lawyers to determine whether there is a risk that sales of the products may involve criminal conduct in the future. The Financial Services Authority and the Bank of England\u2019s Financial Policy Committee have warned of a lack of transparency in the ETF market.
…<\/b>
\u201cFrom the investor\u2019s point of view, I think there are question marks over whether synthetic ETFs really are appropriate for all types of the retail marketplace,\u201d FSA Chief Executive Officer Hector Sants said June 24.<\/p><\/blockquote>\n

Concerns about synthetic ETFs were last discussed on PrefBlog when the BoE June 2011 Financial Stability Report<\/a> focussed on them.<\/p>\n

It was a mixed day for the Canadian preferred share market, as PerpetualDiscounts gained 20bp, FixedResets were up 4bp and DeemedRetractibles lost 8bp. Volatility was quite good. Volume was average; Nesbitt scored a shut-out on the highlights table.<\/p>\n

PerpetualDiscounts now yield 5.44%, equivalent to 7.07% interest at the standard equivalency factor of 1.3x. Long corporates<\/a> now yield about 5.35% so the pre-tax interest-equivalent spread is now about 175bp, a narrowing from the 185bp reported on June 29<\/a> due to a decline of PerpetualDiscount yields.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n1.6939 %<\/td>\n2,457.4<\/td>\n<\/tr>\n
FixedFloater<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n1.6939 %<\/td>\n3,695.9<\/td>\n<\/tr>\n
Floater<\/td>\n2.46 %<\/td>\n2.23 %<\/td>\n43,728<\/td>\n21.69<\/td>\n4<\/td>\n1.6939 %<\/td>\n2,653.4<\/td>\n<\/tr>\n
OpRet<\/td>\n4.87 %<\/td>\n1.73 %<\/td>\n64,046<\/td>\n0.23<\/td>\n9<\/td>\n0.1290 %<\/td>\n2,443.8<\/td>\n<\/tr>\n
SplitShare<\/td>\n5.23 %<\/td>\n1.32 %<\/td>\n55,913<\/td>\n0.64<\/td>\n6<\/td>\n0.3256 %<\/td>\n2,515.4<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.1290 %<\/td>\n2,234.6<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.70 %<\/td>\n5.26 %<\/td>\n142,980<\/td>\n1.27<\/td>\n13<\/td>\n-0.0226 %<\/td>\n2,084.9<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.46 %<\/td>\n5.44 %<\/td>\n114,233<\/td>\n14.68<\/td>\n17<\/td>\n0.2042 %<\/td>\n2,191.6<\/td>\n<\/tr>\n
FixedReset<\/td>\n5.17 %<\/td>\n3.17 %<\/td>\n217,935<\/td>\n2.69<\/td>\n57<\/td>\n0.0442 %<\/td>\n2,316.4<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n5.10 %<\/td>\n4.84 %<\/td>\n275,383<\/td>\n8.13<\/td>\n47<\/td>\n-0.0787 %<\/td>\n2,155.3<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
GWO.PR.N<\/td>\nFixedReset<\/td>\n-4.50 %<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 23.55
\nBid-YTW : 4.31 %<\/td>\n<\/tr>\n
CIU.PR.C<\/td>\nFixedReset<\/td>\n-1.13 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-07-06
\nMaturity Price : 23.02
\nEvaluated at bid price : 24.58
\nBid-YTW : 3.63 %<\/td>\n<\/tr>\n
TDS.PR.C<\/td>\nSplitShare<\/td>\n1.07 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2011-11-15
\nMaturity Price : 10.00
\nEvaluated at bid price : 10.42
\nBid-YTW : -4.84 %<\/td>\n<\/tr>\n
NA.PR.N<\/td>\nFixedReset<\/td>\n1.09 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-08-15
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.20
\nBid-YTW : 2.75 %<\/td>\n<\/tr>\n
NA.PR.O<\/td>\nFixedReset<\/td>\n1.31 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-02-15
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.70
\nBid-YTW : 2.06 %<\/td>\n<\/tr>\n
FTS.PR.E<\/td>\nOpRet<\/td>\n1.75 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-06-01
\nMaturity Price : 25.75
\nEvaluated at bid price : 27.33
\nBid-YTW : 1.73 %<\/td>\n<\/tr>\n
TRI.PR.B<\/td>\nFloater<\/td>\n2.75 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-07-06
\nMaturity Price : 23.62
\nEvaluated at bid price : 23.89
\nBid-YTW : 2.18 %<\/td>\n<\/tr>\n
PWF.PR.A<\/td>\nFloater<\/td>\n2.86 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-07-06
\nMaturity Price : 23.14
\nEvaluated at bid price : 23.40
\nBid-YTW : 2.23 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
CM.PR.J<\/td>\nDeemed-Retractible<\/td>\n114,655<\/td>\nNesbitt crossed 100,000 at 24.50.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.50
\nBid-YTW : 4.73 %<\/td>\n<\/tr>\n
CM.PR.H<\/td>\nDeemed-Retractible<\/td>\n106,596<\/td>\nCalled for redemption<\/a>.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2011-08-05
\nMaturity Price : 25.75
\nEvaluated at bid price : 25.71
\nBid-YTW : 2.69 %<\/td>\n<\/tr>\n
BMO.PR.M<\/td>\nFixedReset<\/td>\n63,259<\/td>\nNesbitt crossed 60,000 at 26.20.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-08-25
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.21
\nBid-YTW : 2.94 %<\/td>\n<\/tr>\n
RY.PR.R<\/td>\nFixedReset<\/td>\n38,365<\/td>\nNesbitt crossed 25,000 at 27.23.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-02-24
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.21
\nBid-YTW : 3.04 %<\/td>\n<\/tr>\n
TD.PR.G<\/td>\nFixedReset<\/td>\n33,933<\/td>\nNesbitt crossed 25,000 at 27.10.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-04-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.10
\nBid-YTW : 2.97 %<\/td>\n<\/tr>\n
POW.PR.B<\/td>\nPerpetual-Discount<\/td>\n28,719<\/td>\nNesbitt crossed 25,000 at 24.45.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2041-07-06
\nMaturity Price : 24.03
\nEvaluated at bid price : 24.28
\nBid-YTW : 5.52 %<\/td>\n<\/tr>\n
There were 31 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
GWO.PR.N<\/td>\nFixedReset<\/td>\nQuote: 23.55 – 24.65
\nSpot Rate : 1.1000
\nAverage : 0.6456<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 23.55
\nBid-YTW : 4.31 %<\/td>\n<\/tr>\n

BAM.PR.O<\/td>\nOpRet<\/td>\nQuote: 25.64 – 26.29
\nSpot Rate : 0.6500
\nAverage : 0.4564<\/p>\n

YTW SCENARIO
\nMaturity Type : Option Certainty
\nMaturity Date\t: 2013-06-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.64
\nBid-YTW : 3.72 %<\/td>\n<\/tr>\n

FTS.PR.G<\/td>\nFixedReset<\/td>\nQuote: 25.76 – 26.23
\nSpot Rate : 0.4700
\nAverage : 0.3494<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2013-09-01
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.76
\nBid-YTW : 4.03 %<\/td>\n<\/tr>\n

PWF.PR.M<\/td>\nFixedReset<\/td>\nQuote: 26.78 – 27.20
\nSpot Rate : 0.4200
\nAverage : 0.3096<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 26.78
\nBid-YTW : 2.95 %<\/td>\n<\/tr>\n

SLF.PR.G<\/td>\nFixedReset<\/td>\nQuote: 25.25 – 25.55
\nSpot Rate : 0.3000
\nAverage : 0.1987<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2022-01-31
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.25
\nBid-YTW : 3.84 %<\/td>\n<\/tr>\n

BAM.PR.J<\/td>\nOpRet<\/td>\nQuote: 27.16 – 27.51
\nSpot Rate : 0.3500
\nAverage : 0.2562<\/p>\n

YTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-03-31
\nMaturity Price : 26.00
\nEvaluated at bid price : 27.16
\nBid-YTW : 3.52 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

Portugal’s downgrade is contagious: Portugal\u2019s downgrade to junk may stifle corporate bond sales in Europe, killing off a mini- revival in issuance spurred by investor optimism about Greece\u2019s efforts to avoid default. \u201cThe primary window …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-15602","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/15602","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=15602"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/15602\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=15602"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=15602"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=15602"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}