The focus last week in Europe was on pricing, with little activity on the primary pipeline by the end of the week.
The secondary markets were also quiet.
"We hear that the pipeline is quietly building, but given the lackluster volume produced to date, we would have expected the poor new issue production to be offset by heightened secondary trading," reported the Royal Bank of Scotland. "A few deals are scheduled to print imminently, but we expect no directional signals."
According to analysts at Dresdner Kleinwort Wasserstein, small bid lists were behind the limited trading activity on the secondary front. But the tone remains strong with positions on the bid list trading at tight levels, adding to the general positive tone of the market last week.
Dealers provided guidance on the 1.5 billion ($1.7 billion) Dutch RMBS for Obvion, Storm 2006-1. The 1.1-year senior notes were talked at 4 to 5 basis points over Euribor. The 6.1-year senior notes were talked at 12 basis points. The double-A rated, Class B notes were guided between 17 and 18 basis points, the Class C notes were talked in the mid-20 basis points range and the Class D notes were guided at mid-40 basis points. The Class E notes were talked between 80 and 90 basis points.
Banca Italease and Italease Network SpA issued guidance on the securitization of deferred purchase residuals from the Italease Finance secruitization series 4, 5, 6 and 7. The triple-B, Class A notes were guided at a spread of 80 to 85 basis points over the three-month Euribor. The double-B rated, Class B was talked at a level of 250 to 275 basis points. The deal is expected to price early this week.
Dealers also provided suggested new issue levels and upsized New Amsterdam Capital's leveraged loan CDO, Meracator CLO. The transaction was upsized to 413 million ($489 million) from 350 million ($415 million). Guidance for the triple-A piece was talked at 26 to 27 basis points over Euribor. The double-A piece was talked at 40 to 45 basis points and the single-A rated piece was guided at 65 to 70 basis points. The Class B1 and Class B2 notes, rated triple-B and double B, were talked at 165 basis points and between 475 and 500 basis points, respectively.
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