Corporate Credit Endures the Urge to Merge (Capital Markets Research)

WEEKLY MARKET OUTLOOKAUGUST 13, 2015CAPITAL MARKETS RESEARCHMoodys Analytics markets and distributes all Moodys Capital Markets Research, Inc. materials. Moodys Capital Markets Research, Inc is a subsidiary of Moodys Corporation. Moodys Analytics does not provide investment advisory services or products. For further detail, please see the last page.Corporate Credit Endures the Urge to MergeCredit Markets Review and Outlook by John Lonski Corporate Credit Endures the Urge to Merge. ¯ FULL STORY PAGE 2Topic of the Week by Ben Garber Flattening Yield Curve Can Hinder Bond Outflow.¯ FULL STORY PAGE 6The Week Ahead We preview economic reports and forecasts from the US, UK/Europe, and Asia/Pacific regions. ¯ FULL STORY PAGE 9 The Long View Check our chart here for forecast summaries of key credit market metrics. Full updated stories, The highest speculative-grade bond yield and widest high-yield spread since mid-December 2014 are likely to weigh on high-yield bond offerings, begin on page 18.¯ FULL STORY PAGE 18Ratings Round-Up by Ben Garber and Njundu Sanneh M&A Stands Out as Driver of Rating Actions.¯ FULL STORY PAGE 21Market Data Credit spreads, CDS movers, issuance.¯ FULL STORY PAGE 23Moodys Capital Markets Research recent publications Links to commentaries on: STI, CMA, Linn, Brazil, PRU, dollar, bank risk, Unilever, ExxonMobil, CAT, Chevron. ¯ FULL STORY PAGE 27Credit Spreads Investment Grade: Year-end 2015 spread to resemble its recent 159 bp.High Yield: Recent spread of 573 bp should approximate 520 bp by year-end 2015.Defaults US HY default rate: June 2015, 2.0%; Moodys Credit Policy Group forecasts 3.0% in 1H2016Issuance For 2015, US$ IG bond offerings may grow by 23% to $1.394 trillion, while US$ HY bond issuance sinks by -4% to $403 billion. In 2014, US$ IG bond issuance rose by 0.9% to $1.129 trillion, while US$ HY bond issuance dropped by -2.3% to $421 billion.Click here for Moodys Credit Outlook, our sister publication containing Moodys rating agency analysis of recent news events, summaries of recent rating changes, and summaries of recent research.Moodys Capital Markets Research, Inc.Weekly Market Outlook Contributors: David W. Munves, CFA 1.212.553.2844 david.munves@moodys.com John Lonski 1.212.553.7144 john.lonski@moodys.com Ben Garber 1.212.553.4732 benjamin.garber@moodys.com Njundu Sanneh 1.212.553.4036 njundu.sanneh@moodys.com Yukyung Choi 1.212.553.0906 yukyung.choi@moodys.com Irina Baron 1.212.553.4307 irina.baron@moodys.com Franklin Kim 1.212.553.4419 franklin.kim@moodys.com Xian (Peter) Li1.212.553.1404 Xian.li@moodys.comMoody's Analytics/Europe: Tomas Holinka 1.420 ( 221) 666-384 Tomas.holinka@moodys.comMoody's Analytics/Asia-Pacific: Katrina Ell 1.612.9270.8144 Katrina.ell@moodys.com Faraz Syed 1.612.9270.8146 Faraz.Syed@moodys.comEditor Dana Gordo...