The US investment-grade and high-yield corporate bond primaries are quiet on Wednesday, the eve of the Thanksgiving Day holiday.
The ABS market is also idle today. In the ECM arena, IPOs were on the menu Wednesday.
US markets will be closed Thursday and reopen on Friday, with bond markets then closing early at 2:00pm New York time.
It is, however, another busy day for economic data in the holiday-shortened week, as more reports are squeezed into Wednesday release slots, including initial weekly jobless claims, preliminary Q3 GDP and durable goods. Meanwhile the Federal Reserve's FOMC minutes from the last meeting, released yesterday afternoon, highlighted the Fed's caution on how to proceed with further rate cuts.
No offerings were priced in the IG primary or the HY primary on Tuesday.
The average IG bond spread edged wider by 1bp to 81bp on Tuesday and the HY bond spread widened by 4bp to 268bp, according to ICE BofA. US yields across asset classes were higher on Tuesday.
HIGH GRADE
No investment-grade issuers are expected to price new bonds on Wednesday.
Today would be the second day in the row this week with no deals. Seven high-grade issuers raised a combined US$13.7bn on Monday, bringing issuance for November to US$98.2bn, according to IFR data.
Investment-grade volume so far this year is about US$1.5trn, already more than the US$1.2trn of deals that priced during all of last year, the data show.
LEVERAGE/HIGH YIELD
The US high-yield primary is on course for another no-deal day as market players take a break ahead the Thanksgiving holiday on Thursday.
The market has seen just one deal this week, a US$450m five-year bond from Blackstone Mortgage Trust.
The mortgage REIT priced the deal at par to yield 7.75% and saw the bond trade as high as 101.615 yesterday, according to MarketAxess data.
STRUCTURED FINANCE
No asset-backed deals are expected to price today as most dealmakers begin their Thanksgiving break.
Primary activity will resume in earnest next week as some issuers seek to lock in funding ahead of year-end, market participants said.
LATAM
Argentine oil producer Vista Energy will start meeting with fixed-income investors today for a potential benchmark-sized offering of senior unsecured notes of intermediate maturity. Citigroup, Deutsche Bank, Itau, JP Morgan and Santander have been mandated as joint lead managers to arrange the meetings.
S&P downgraded Panama yesterday to BBB- from BBB to reflect increased "vulnerability to economic and fiscal challenges ahead." The outlook is stable.
Moody's yesterday upgraded Mexican telecom Total Play and its backed senior secured global notes due 2028 to B3 from Caa1. It also changed the outlook to stable from negative. The action reflects the company's "improved liquidity position following the bond exchange and liability management transactions in recent months," the rating agency said.
Moody's also upgraded El Salvador to B3 from Caa1, keeping the outlook stable.
"The upgrade [...] reflects our view that the sovereign's credit profile has benefited from recent liability management operations that have significantly reduced external amortizations leading to a material decrease in repayment risk and alleviating near and medium-term liquidity pressures," the agency said.
Moody's also expects that fiscal consolidation measures taken by the authorities will support debt sustainability and strengthen the country's credit profile.
EQUITIES
Pony.ai broke through some geopolitical red tape to price a US$260m Nasdaq IPO early Wednesday, a week later than hoped after the SEC review process delayed the offering.
Goldman Sachs, Bank of America, Deutsche Bank and Huatai Securities priced a full-sized offering of 20m shares in the Chinese robotaxi/autonomous driving outfit at US$13, at the top of the US$11-$13 marketing range.
The IPO was originally scheduled to price on November 20.
The China-to-US IPO was delayed because US regulators would not sign off on the final prospectus until late Tuesday, according to syndicate sources.
The offering, which values Pony.ai at US$4.5bn, was backed with US$75m of demand from cornerstone investors.
A concurrent private placement raised another US$153.4m, taking the overall proceeds above US$413m.
Pony.ai shares will begin trading on Nasdaq on Wednesday under the symbol “PONY”.
Brazil Potash also raised US$30m from its NYSE IPO, finally pricing the offering late Tuesday after twice slashing its size.
Cantor Fitzgerald and Bradesco led the sale of 2m shares of the Canadian owner of potash-rich land in the Amazon at US$15, the bottom of the US$15-$18 marketing range. A week ago, Brazil Potash cut the offering to 2.4m shares from 4.25m shares.
US ECM is otherwise quiet early Wednesday as market participants focus on their Thanksgiving holiday travel plans.
No other deals launched or priced overnight Tuesday after syndicate desks raised more than US$1bn from four offerings on Monday.
Robust secondary ECM and convertible bond issuance, plus some limited IPO activity, should resume in the first two weeks of December before the market shuts down for the rest of the year.