Morning Commentary: Investment-grade deal activity quiets; DTE Energy flat; Verizon softens

By Cristal Cody

Tupelo, Miss., March 23 – Activity in the high-grade bond market slowed on Thursday with no reported issuers in the U.S. deal pipeline over the morning.

In economic data released at the start of the day, the Labor Department reported weekly unemployment claims came in at 258,000 for the previous week, higher than analysts’ forecasts of 240,000.

Bonds were mixed in the secondary market.

DTE Energy Co.’s 3.8% senior notes due March 15, 2027 that priced earlier in the month were unchanged.

Verizon Communications Inc.’s 4.125% notes due March 16, 2027 softened in early secondary trading.

On Wednesday, $19.16 billion of high-grade issues were traded, compared to $20.52 billion on Tuesday and $13.70 billion on Monday, according to Trace.

DTE Energy stable

DTE Energy’s 3.8% senior notes due March 15, 2027 were flat in early secondary trading at 101.43, a market source said.

The company sold $500 million of the notes (Baa1/BBB/BBB+) on March 8 at 99.736 to yield 3.832%, or a spread of 128 basis points over Treasuries.

DTE is a Detroit-based diversified energy company.

Verizon slips

Verizon Communications’ 4.125% notes due March 16, 2027 opened lower at 101.76 from where the notes went out on Wednesday at 102.16 in the secondary market, a source said.

Verizon sold $3.25 billion of the notes (Baa1/BBB+/A-) on March 13 at 99.256 and a spread of Treasuries plus 160 bps.

The telecommunications company is based in New York City.

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