High-grade action slows as SEC closes, holiday nears; January supply eyed; trading thin

By Cristal Cody

Tupelo, Miss., Dec. 24 – Christmas cheer was in short supply on the eve of the holiday with the U.S. Securities and Exchange Commission, among other government entities, closed.

Little activity was expected in the high-grade bond markets with most desks thinly staffed for the remainder of the year, sources report.

The bond markets closed at 2 p.m. ET on Monday and will remain closed on Tuesday for the Christmas Day holiday.

December deal volume is set to post the weakest supply totals since the 2007-2008 financial crisis, according to market sources.

Nearly $9 billion of high-grade corporate bonds have priced month to date.

Looking ahead to January, market sources predict a busy high-grade calendar, depending on volatility.

About $100 billion to $120 billion of bond volume is expected by syndicate sources for January.

Meanwhile, very little activity was seen in the secondary market over the short session on Monday.

General Motors Co.’s $2.1 billion of senior notes (Baa3/BBB/BBB) that priced in three tranches in September also have been among the most active high-grade issues in the secondary market in December, according to Trace.

On Monday, the company’s 5% notes due Oct. 1, 2028 traded mostly unchanged to slightly weaker from Friday at 94.54.

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