Morning Commentary: Investment-grade credit spreads stable; Eastman Chemical, Verizon firm

By Cristal Cody

Tupelo, Miss., Nov. 13 – High-grade credit spreads were stable early Thursday following more than $12 billion of issuance in the previous session, market insiders said.

In the secondary market, Eastman Chemical Co.’s 4.65% senior notes due 2044 that reopened on Monday traded about 3 basis points better than issuance on Thursday, according to a market source.

Verizon Communications Inc.’s 3.5% senior notes due 2024 were about 2 bps tighter but remain flat from where the notes priced in October, a market source said.

The Markit CDX North American Investment Grade series 23 index ended unchanged on Wednesday at a spread of 64 bps.

Eastman Chemical firms

Eastman Chemical’s 4.65% notes due 2044 (Baa2/BBB/BBB) traded early Thursday at 182 bps offered, a market source said.

The company priced a $400 million add-on to the existing 4.65% notes due 2044 on Monday at Treasuries plus 185 bps.

Eastman Chemical originally sold $500 million of the notes on May 6, 2014 at Treasuries plus 135 bps.

The global chemical company is based in Kingsport, Tenn.

Verizon steady

Verizon’s 3.5% notes due 2024 (Baa1/BBB+/A-) traded 2 bps tighter to 135 bps offered, a market source said.

Verizon sold $2.5 billion of the notes on Oct. 22 at a spread of Treasuries plus 135 bps.

The telecommunications company is based in New York City.

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