Trading muted as 2018 junk market gets underway; $15 billion to $20 billion January expected

By Paul A. Harris

Portland, Ore., Jan. 2 – Trading activity was muted on Tuesday morning as the high-yield market got underway in the New Year, according to a bond trader.

With the barrel price of West Texas Intermediate (WTI) crude oil now topping the $60 mark, the energy sector was a modest outperformer during the morning, the trader said.

However WTI futures were flat to slightly lower on Tuesday morning at $60.32 per barrel, down a dime, or 0.17%.

Elsewhere junk was flat.

High-yield ETFs were flat to slightly higher.

The SPDR Blmbg Barclays High Yield Bd ETF (JNK) was up 4 cents, or 0.05%, at $87.30 per share at midmorning.

Arby’s

The new issue market remained dormant on Tuesday morning.

There is a modest January pipeline and $15 billion to $20 billion is anticipated to clear the market during the opening month of 2018, the trader said.

Arby’s Restaurant Group Inc. might come as early as the Jan. 8 week with a $485 million offering of senior notes backing its acquisition of Buffalo Wild Wings Inc., the source added.

Barclays will lead the deal, market sources say.

An issuance blackout ahead of quarterly earnings reports scheduled for the end of the month can be expected to constrict January issuance somewhat, sources say.

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