Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  NASDAQ OMX COPENHAGEN  >  Nordea Bank AB    NDA DKK   SE0000427361

Delayed Quote. Delayed  - 09/26 03:38:53 pm
64.9 DKK   -1.96%
09/23 NORDEA BANK : will cease using a scale to summarisecredit quality in..
09/20 NORDEA BANK : J. Lauritzen welcomes new CEO
09/20 SWEDBANK : Eika Boligkreditt AS has mandated for a new covered bond ..
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

Bank Bonds Lead Corporate Market Higher

share with twitter share with LinkedIn share with facebook
share via e-mail
0
03/14/2012 | 10:16pm CEST

--Corporate bonds outperform as Treasury yields soar

--Weekly issuance jumped beyond $20B

--New deals price at attractive levels

(Refreshed final pricing numbers throughout, added investor comments in 3rd and 5th paragraphs, added Treasury yields in 4th paragraph, and updated issuance total in 14th paragraph.)

 
   By Patrick McGee 
   Of  
 

A range of companies tapped the U.S. credits markets on signs that investor demand for risky assets is holding up, particularly after the Federal Reserve said 15 of the biggest 19 U.S. banks would survive a depression-style hit to the economy.

At least four sizable issues accessed the market, led by a $2 billion offering from J.P. Morgan Chase & Co. (>> JPMorgan Chase & Co.), plus two-part offerings from Nordea Bank (NRDEF, NRBAY, NDA.SK), Philip Morris (PM), and Medtronic (>> Medtronic, Inc.).

Investment-grade corporate bonds continue to offer attractive value while safe-haven assets plummet, according to John Huber, who oversees fixed-income research and portfolio management at RBC Global Asset Management.

The 10-year Treasury yield jumped 16 basis points in late trading to 2.28%, its highest yield since October 31. But appetite for corporates remained in place, as reflected by Markit's CDX North America Investment-Grade Index, which is at its best level since early July.

"It has to do with the scarcity of good alternatives to invest in out there," Huber said. "They are selling off, but they are selling off less so than Treasurys are, so they continue to be the place to be if you think rates are going to rise."

J.P. Morgan helped push up the entire U.S. equity market Tuesday when it reported a 20% increase in its quarterly dividend and authorized $15 billion in stock buybacks, just before the Fed released results of its Comprehensive Capital Analysis and Review, also known as the "stress tests" for the 19 largest banks.

Dividend increases and stock buybacks are shareholder-friendly activities that are, at best, neutral to bondholders. But the sign of strength banks showed in the stress tests spurred investors to buy bank bonds, said Jesse Fogarty, portfolio manager at Cutwater Asset Management.

"Bank spreads closed very firm as the overall message from the domestic banking sector was positive despite running the scenario analysis to a pretty harsh downside," he said. "We expect more bank issuance on the recent snap tighter in spreads, getting in any funding before first quarter earnings season begins."

The financial sector dominated secondary trading. Ten-year paper from Goldman Sachs Group (>> Goldman Sachs Group, Inc.), Morgan Stanley (>> Morgan Stanley), and Bank of America Corp. (>> Bank of America Corp) outperformed Treasurys by 0.09, 0.25, and 0.24 percentage points, respectively, according to MarketAxess

Barclays Capital strategists said in a note Wednesday that the Fed's tests were "indeed highly stressful and should help ease any concerns regarding the capital position of U.S. banks."

Nordea Bank's $2.75 billion offering included $1 billion of three-year notes sold at 1.75 percentage points over Treasurys, and $1.75 billion of five-year notes at 2.05 points over Treasurys.

Philip Morris priced $1.25 billion in five- and 30-year maturities, at respective spreads to Treasurys of 0.68 points and 1.23 points.

Medtronic sold $675 million of 10-year notes priced to yield 3.161%, or 0.90 percentage points over Treasurys, and $400 million of 30-year notes priced to yield 4.51%, or 1.1 points over Treasurys. The pricing of each bond was 0.05 points tighter than earlier guidance, indicating broad demand.

"The technicals supporting the market remain in place even after the large supply of volume last week," said a syndicate manager in New York.

The $42.4 billion of high-grade debt sold last week was the second-highest in weekly records going back to 1995, and the most since early 2009, according to data provider Dealogic. This week's tally has been more subdued, with roughly $20.3 billion priced so far this week.

Key drivers enabling the rally are strong U.S. economic data and the Greek deal being put to bed, according to Scott MacDonald, head of research for MC Asset Management Holdings.

"The rally continues, albeit with a little more volatility injected into the mix," he added. "It reflects creeping optimism over U.S. economic growth, which is filtering into markets."

Yields on corporate bonds rose 0.04 percentage points to 3.39% on Tuesday's, but spreads compressed 0.017 points to 1.826 points over Treasurys. The 3.39% yield is the highest since February 21, but still just 0.12 points from the record low.

-By Patrick McGee, Dow Jones Newswires; 212-416-2382; patrick.mcgee@dowjones.com

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on NORDEA BANK AB
09/23 NORDEA BANK : Latvijas Dzelzcels railway company to take EUR 13.3 million loan f..
09/23 NORDEA BANK : planning on introducing contactless debit-cards in Baltics by year..
09/23 NORDEA BANK : will cease using a scale to summarisecredit quality in credit rese..
09/20 NORDEA BANK : J. Lauritzen welcomes new CEO
09/20 NORDEA BANK : grants EUR 19.9 million loan to Unity business center
09/20 SWEDBANK : Eika Boligkreditt AS has mandated for a new covered bond transaction
09/17 NORDEA BANK : Danish central bank seen holding rates for long
09/16 NORDEA BANK : NIB buys green bonds in cooperation with arranging banks
09/14 AFARAK : Completes share based compensation
09/12 NORDEA BANK : nomination committee for the Annual General Meeting 2017 appointed
More news
Sector news : Banks - NEC
03:03p DEUTSCHE BANK : says no need for Berlin's help in $14 billion U.S. dispute
02:54pDJDNB : Norway's DNB Names Kjerstin Braathen CFO as Predecessor Retires
02:50pDJDNB : Norway's DNB Names Kjerstin Braathen CFO as Predecessor Retires
02:44pDJDNB : Norway's DNB Names Kjerstin Braathen CFO Effective as Predecessor Retires
02:36pDJIndian Stocks Emerge From the Crowd
More sector news : Banks - NEC
Advertisement
Financials (€)
Sales 2016 9 659 M
EBIT 2016 4 749 M
Net income 2016 3 388 M
Debt 2016 -
Yield 2016 6,79%
P/E ratio 2016 10,65
P/E ratio 2017 10,50
Capi. / Sales 2016 3,74x
Capi. / Sales 2017 3,61x
Capitalization 36 084 M
More Financials
Chart NORDEA BANK AB
Duration : Period :
Nordea Bank AB Technical Analysis Chart | NDA DKK | SE0000427361 | 4-Traders
Full-screen chart
Income Statement Evolution
More Financials
Consensus 
Mean consensus OUTPERFORM
Number of Analysts 23
Average target price 9,36 €
Spread / Average Target 5,1%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Casper W. von Koskull President & Group Chief Executive Officer
Björn Arne Christer Wahlroos Chairman
Torsten Hagen Jørgensen Group COO, Executive VP & Deputy CEO
Heikki Esa Petteri Ilkka Group CFO & Head-Group Finance & Business Control
Lars-Göran Nordström Independent Director
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
NORDEA BANK AB-11.94%40 508
JPMORGAN CHASE & CO.1.85%242 906
INDUSTRIAL AND COML BA..-3.06%234 074
WELLS FARGO & CO-15.86%230 783
CHINA CONSTRUCTION BAN..-9.52%191 203
BANK OF AMERICA CORP-7.78%158 378
More Results