Commentary

Our insights into Canadian and global credit markets are key to our investment process.
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OUR LATEST HIGHLIGHT IN CORPORATE CREDIT

Highlights from the Week in Corporate Credit:
September 14 – 18, 2020

Credit markets outperformed equities last week as the Fed failed to ease market jitters amid a lack of US fiscal stimulus and concerns over a COVID second wave. Although Fed Chair Powell attempted to set a dovish tone at the FOMC press conference, the lack of any concrete policy changes disappointed traders, instigating a sell-off in equities while the Treasury curve steepened slightly. But credit spreads still managed to finish modestly tighter alongside another busy week in primary issuance. The IG market saw $44bn of new paper come to market across 45 deals. This week’s tally brings the month of September to $119bn, just under market expectations for the full month.

The Canadian credit market was constructive with secondary spreads about 2 bp tighter while new issues were in focus. The primary market had one the busiest weeks of late, with 3.275bn CAD printed across ten issuers. The real estate sector was the highlight with new issues from Morguard Corp, Artis REIT, Sienna Senior Living and an inaugural issue from Summit Industrial Income REIT totalling 850mmm CAD in total. The new issues were generally well-received and repriced secondary curves tighter.

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