Thursday Corporate Bond Brief
Andrew Wilkinson submits:
While we know that the Fed is unlikely to move interest rates this year and possibly all of 2012, we should expect the occasional piece of positive economic data to come along and carpet-bomb the bond market on occasion. Today’s long-range missile came from an unexpected jump in manufacturing activity in the Chicago-area where manufacturers reported a healthy pace of activity. Yields continued to retreat from a recent nadir as equity prices similarly advanced. Corporate bonds came back in to favor with some spreads narrowing in light of increasing economic optimism.
Lloyds TSB Bank Pls. (LYG)
Shares in Lloyds TSB surged by more than 10% after its CEO announced a huge downsizing that allows the bank to focus on domestic retail issues. Bonds issued by the partially-government-owned banker, like many European issues, have failed to benefit from the recent slide in yields as investors shunned overseas bonds.Complete Story »