Primary takes break; low-volume week expected; Exxon Mobil eases; Apple widens; HSBC firms

By Cristal Cody

Eureka Springs, Ark., April 27 – High-grade primary action took a break on Wednesday following the Federal Reserve’s policy decision to leave rates unchanged.

Some additional issuance is expected by Friday, though market sources peg the week’s total volume in the $15 billion area.

“We expect it to [resume] slightly,” one source said. “Still, it’s going to be a low overall week here.”

Credit spreads closed the day better. The Markit CDX North American Investment Grade series 23 index tightened 1 basis point to a spread of 74 bps.

In the secondary market, Exxon Mobil Corp.’s 3.043% notes due 2026 traded 4 bps weaker at 81 bps bid on Wednesday, a day after the company was downgraded by Standard & Poor’s to AA+ from AAA.

The company sold $2.5 billion of the notes on Feb. 29 at 130 bps over Treasuries.

Apple Inc.’s 3.25% notes due 2026 widened to 94 bps bid on Wednesday from 87 bps bid in the previous session, according to a market source.

The company priced a $1.25 billion add-on to the issue on March 17 at a spread of Treasuries plus 100 bps.

HSBC Holdings plc’s 4.3% notes due 2026 firmed 1 bp over the day to 189 bps bid, a market source said.

HSBC sold $3 billion of the notes (A1/A/AA-) on March 1 at a spread of 250 bps plus Treasuries.

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