CAM High Yield Weekly Insights

Fund Flows & Issuance: According to Wells Fargo, flows week to date were -$0.9 billion and year to date flows stand at -$3.3 billion. New issuance for the week was $9.2 billion and year to date HY is at $75.4 billion.

(CNBC) Housing Market is Quite Strong Across the United States

• Consumer sentiment in both the economy and the housing market is rising and that is translating into strong demand from homebuyers. The trouble is, the supply of homes for sale is incredibly weak and getting weaker. What is for sale is selling fast.
• The typical home that sold last month went under contract in 60 days, eight days faster than one year ago, according to a new report from Redfin, a real estate brokerage. Nearly 15 percent of all homes listed for sale in February were off the market within two weeks, up from 11.7 percent last year. This is the fastest February market Redfin has recorded since it began tracking in 2010.

(Business Wire) B&G Foods Announces CFO Resigns to Pursue Other Opportunities

• Thomas P. Crimmins, the Company’s Chief Financial Officer, has resigned to pursue other opportunities. Mr. Crimmins’ decision was not the result of any dispute or disagreement with the Company on any matter relating to the Company’s accounting practices or financial statements.
• The Company has initiated a search for a new Chief Financial Officer and until one is appointed, Amy Chiovari, currently the Company’s Corporate Controller, will serve as Interim Chief Financial Officer.
• “On behalf of our entire team, I want to thank Tom for his contributions to B&G Foods’ success over the past two years and wish him continued success in his future endeavors,” said Robert C. Cantwell, President and Chief Executive Officer of B&G Foods. “I am also pleased to report Amy Chiovari will serve as Interim Chief Financial Officer. Amy has been an invaluable member of the B&G Foods family since joining the Company in 1996. Amy has served in various capacities within our accounting and finance department and over the years has been responsible for many functions, including, corporate accounting, corporate finance, financial reporting, treasury, tax and internal control over financial reporting.

(The American Institute of Architects) Architecture Billings Index rebounds into positive territory

• Business conditions projected to solidify moving into the spring and summer
• The American Institute of Architects (AIA) reported the February ABI score was 50.7, up from a score of 49.5 in the previous month. This score reflects a minor increase in design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 61.5, up from a reading of 60.0 the previous month, while the new design contracts index climbed from 52.1 to 54.7.
• “The sluggish start to the year in architecture firm billings should give way to stronger design activity as the year progresses,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “New project inquiries have been very strong through the first two months of the year, and in February new design contracts at architecture firms posted their largest monthly gain in over two years.”

(Bloomberg) Ally Adds Fuel to Avis’ and Hertz’ Fire on Residual Credit Risk

• Ally Financial Inc. warned profit may grow less than anticipated only a few months ago, the latest sign that automakers’ heavy discounting and aggressive use of leasing to boost sales has created a supply glut hurting lenders and rental-car companies.
• Ally Financial’s comments that used-car prices were down 7% in 1Q vs. its forecast of 5% adds fuel to the fire on the topic of residual values. Issuers such as Avis and Hertz, as well as automotive OEMs such as Ford and GM, are exposed to potential higher depreciation and writedowns if asset values decline faster than previously anticipated.
• The National Automobile Dealers Association’s Used Car Guide index declined 3.8 percent in February, the eighth consecutive drop and the steepest since November 2008.

(Bloomberg) Trump Digs in Heels on Gambit for GOP to Vote on Health Bill

• The Trump administration doubled down on its demand that House Republican leaders hold a vote Friday on their embattled health-care bill without any changes and with lingering uncertainty about whether they have enough support to pass the measure.
• If the high-stakes gamble works and the House manages to pass the Obamacare replacement bill, it will be an important win for Trump and House Speaker Paul Ryan who have formed an uneasy alliance to repeal former President Barack Obama’s signature health-care law.
• If the measure is blocked, it will be an embarrassing setback that casts doubt on Trump and Ryan’s ability to deliver on their ambitious agenda, including taxes and infrastructure, both of which are being closely watched by Wall Street.
• “He wants to do this and he wants to do it now,” White House budget director Mick Mulvaney said of Trump on ABC Friday morning. “He also wants to move on to things like tax reform, infrastructure, restructuring the government, putting people back to work. He’s not willing to wait the several months an ordinary president would.”
• The Trump administration made a last-minute deal with House conservatives to change the bill — by removing Obamacare’s requirements that certain essential benefits be covered by insurance — in an effort to win over holdouts, who had forced GOP leaders to delay a vote originally scheduled for Thursday.
• Then Trump aides, including senior strategist Steve Bannon, went to Capitol Hill to deliver a message in person to House leaders and the Republican caucus that the president has run out of patience: Trump wanted a vote Friday, win or lose, even if that means leaving Obamacare in place.