SCIWire

US CLOs watchful

Tuesday 7 March 2017 15:50 London/ 10.50 New York/ 23.50 Tokyo

US CLO secondary market participants are watching closely for any signs of potential widening despite continuing positive sentiment.

"Market tone continues to be very positive and nothing came out of the Vegas conference to change that," says one trader. "So, of course, many are starting to get a little nervous and watching closely for signs of any change."

The trader continues: "There are concerns that this really is the top as it's not clear what will push us beyond current levels and consequently fears are emerging that we'll start widening instead. Equally, BWIC volumes haven't been very high over the last couple of weeks following a series of $1bn plus weeks that underlined the generally strong sentiment."

Today looks to be relatively quiet too with six BWICs on the US CLO calendar for today so far. Nevertheless, the trader says: "Everyone will be focused even with relatively few lists out today, especially as they mainly surround mezz, which has seen the most tightening."

The chunkiest auction involves three slices of mezz and equity from MHAWK 2013-2A. Due at 11:00 New York time the list comprises: $3m MHAWK 2013-2A D, $11m MHAWK 2013-2A E and $35.67m MHAWK 2013-2A SUB.

None of the tranches has covered on PriceABS in the past three months.

07/03/2017 15:50:48