Morning Commentary: Bank of America, Nike market notes; bonds mixed; Kroger mostly unchanged

By Cristal Cody

Eureka Springs, Ark., Oct. 18 – Additional high-grade bank and financial supply is expected over Tuesday’s session following deals on Monday from Citigroup Inc. and JPMorgan Chase & Co.

Bank of America Corp. is marketing fixed- and floating-rate medium-term senior notes in two tranches.

Also, Nike, Inc. is in the deal pipeline with a two-part notes offering.

Market sources expect about $25 billion of high-grade supply over the week.

Bonds were mixed in early secondary trading with bank and financial paper modestly softer as stocks improved and Treasuries traded mostly unchanged, sources report.

Kroger Co.’s new 3.875% senior notes due 2046 traded flat to 1 basis point tighter.

The Markit CDX North American Investment Grade index firmed about 1 bp to a spread of 75 bps on Tuesday.

The three-month Libor yield was unchanged over the morning at 88 bps.

On Monday, $13.87 billion of investment-grade issues were traded, according to Trace.

Kroger mostly flat

Kroger’s 3.875% notes due 2046 were quoted flat to 1 bp tighter early Tuesday at 149 bps offered, according to a market source.

Kroger sold $500 million of the bonds on Sept. 26 at a spread of Treasuries plus 155 bps.

The grocery retailer is based in Cincinnati.

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