Summary: Corporate bond spreads about 3bps wider on average; swap spreads widen; iTraxx up 1.50 points; domestic issuance volumes steady; kangaroo market volumes pick up again.
Corporate spreads finished the week about 3bps wider on average as corporate yields generally outpaced the rises of their Commonwealth counterparts. The majority of spreads’ week-on-week changes at the individual level were within a range of -3bps to +8bps and the only notable exception came from Stockland’s November 2022s (spread: 92bps, +66bps) which is very close to its maturity date.
One of the two other main measures of corporate risk, swap-to-bond spreads, widened along its curve. The other measure, credit default swap premiums, also increased. The Australian credit default swap index, the iTraxx Australia Series 37, finished 5.80 points higher at 104.50 points.
Volumes in the primary market for corporate bonds and notes remained pretty steady. $2.70 billion worth of bonds or notes were priced by local entities or their subsidiaries, whereas in the previous week issuance amounted to $2.75 billion. There was one asset-backed transaction which accounted for $500 million of the $2.70 billion.
Kangaroo market volumes picked up again on the back of a $1 billion issue of September 2027s by the Canada Pension Plan Investment Boards. $1.5 billion worth of bonds or notes were issued, up from the previous week’s $1 billion.
Interested readers can find the week’s bond transactions in our tables via the link below.
| ISSUER | MATURITY | COUPON (%) | RATING | WEEK HIGH | WEEK LOW | CLOSING YIELD | Δ WEEK | Δ MONTH |
|---|---|---|---|---|---|---|---|---|
| Wells Fargo | 7-Sep-22 | 5.25 | A- | 2.70 | 2.70 | 2.70 | 0.01 | 0.29 |
| Melbourne Airport | 15-Sep-22 | 4.00 | BBB+ | 2.65 | 2.64 | 2.65 | 0.08 | 0.12 |
| Telstra | 16-Sep-22 | 4.00 | A | 2.50 | 2.48 | 2.49 | -0.02 | -0.09 |
| Stockland | 23-Nov-22 | 4.50 | A- | 3.28 | 3.28 | 3.28 | 0.73 | 1.03 |
| ANZ | 16-Aug-23 | 5.00 | AA- | 3.87 | 3.81 | 3.86 | 0.15 | 0.03 |
| Transpower NZ | 28-Aug-23 | 5.75 | AA- | 3.83 | 3.83 | 3.83 | 0.09 | 0.03 |
| Mirvac Finance | 18-Sep-23 | 3.50 | BBB+ | 4.10 | 4.10 | 4.10 | 0.11 | 0.02 |
| Qantas | 10-Oct-23 | 4.40 | BB+ | 4.65 | 4.60 | 4.64 | 0.14 | -0.07 |
| Australia Post | 13-Nov-23 | 5.50 | A+ | 3.88 | 3.83 | 3.87 | 0.09 | 0.02 |
| Westpac | 21-Nov-23 | 4.40 | AA- | 3.94 | 3.88 | 3.94 | 0.13 | 0.00 |
| Fonterra | 26-Feb-24 | 5.50 | A- | 4.26 | 4.22 | 4.26 | 0.14 | 0.04 |
| NAB | 11-Mar-24 | 5.00 | AA- | 4.09 | 4.04 | 4.09 | 0.15 | 0.10 |
| Rabobank Nederland (Aust) | 11-Apr-24 | 5.50 | A+ | 4.19 | 4.14 | 4.18 | 0.15 | 0.05 |
| CBA | 27-May-24 | 4.75 | AA- | 4.19 | 4.12 | 4.19 | 0.17 | 0.12 |
| AusNet | 21-Jun-24 | 4.00 | BBB+ | 4.75 | 4.70 | 4.74 | 0.18 | 0.07 |
| Macquarie Bank | 7-Aug-24 | 1.75 | A+ | 4.43 | 4.32 | 4.42 | 0.21 | 0.05 |
| Wells Fargo | 27-Aug-24 | 4.75 | A+ | 4.77 | 4.71 | 4.76 | 0.16 | 0.13 |
| University of Sydney | 28-Aug-25 | 3.75 | Aa1 | 4.35 | 4.23 | 4.35 | 0.26 | 0.23 |
| Apple Inc | 10-Jun-26 | 3.60 | AA+ | 4.37 | 4.31 | 4.37 | 0.19 | 0.07 |
| CBA | 11-Jun-26 | 4.20 | AA- | 4.47 | 4.40 | 4.47 | 0.19 | 0.14 |
| ANZ | 22-Jul-26 | 4.00 | AA- | 4.48 | 4.41 | 4.48 | 0.19 | 0.11 |
| Qantas | 12-Oct-26 | 4.75 | BB+ | 5.61 | 5.54 | 5.61 | 0.20 | 0.08 |
| Australia Pacific Airports | 4-Nov-26 | 3.75 | BBB+ | 5.10 | 5.08 | 5.10 | 0.14 | 0.02 |
| CBA | 17-Nov-26 | 3.25 | AA- | 4.39 | 4.39 | 4.39 | 0.11 | 0.05 |
| Australia Post | 1-Dec-26 | 4.00 | A+ | 4.44 | 4.37 | 4.44 | 0.20 | 0.11 |
| WSO Finance | 31-Mar-27 | 4.50 | A- | 4.88 | 4.88 | 4.88 | 0.11 | -0.05 |
| Telstra | 19-Apr-27 | 4.00 | A | 4.72 | 4.64 | 4.72 | 0.20 | 0.03 |
| Vicinity Centre | 26-Apr-27 | 4.00 | A | 5.10 | 5.10 | 5.10 | 0.11 | -0.03 |
| Dexus Finance | 11-May-27 | 4.25 | A3 | 4.88 | 4.88 | 4.88 | 0.13 | -0.04 |
| Asciano | 12-May-27 | 5.40 | BBB- | 6.04 | 5.98 | 6.04 | 0.21 | -0.03 |
| Fonterra | 2-Nov-27 | 4.00 | A- | 4.90 | 4.82 | 4.90 | 0.23 | 0.13 |
| Macquarie | 15-Dec-27 | 4.15 | BBB+ | 5.57 | 5.49 | 5.57 | 0.22 | 0.10 |
| AusNet | 21-Aug-28 | 4.20 | A- | 5.68 | 5.61 | 5.68 | 0.24 | 0.04 |