Midday Commentary: Market tone falters following positive session; GE, Allegheny notes firm

By Aleesia Forni and Andrea Heisinger

New York, July 10 -The high-grade bond market's tone was slightly weaker on Wednesday, sources said, following a flurry of activity on Tuesday.

The Markit CDX North American Investment Grade index was 1 basis point wider at a spread of 82 bps.

Meanwhile, one trader noted General Electric Capital Corp.'s recent sale of fixed-rate notes trading better at mid-morning.

Allegheny Technologies Inc.'s $500 million of 10-year senior notes were also quoted tighter early during the session, the trader said.

GE notes firm

General Electric Capital's $1.25 billion of 1.5% three-year notes traded 4 bps better on Wednesday at 79 bps bid, 74 bps offered, a trader said.

The notes were sold at a spread of Treasuries plus 83 bps on Tuesday.

The sale also included $900 million of two-year floating-rate notes priced at par to yield Libor plus 38 bps and a $1.35 billion tranche of three-year floaters also priced at par to yield Libor plus 65 bps.

The funding arm of General Electric Co. is based in Norwalk, Conn.

Allegheny improves

In other secondary action, Allegheny Technologies' $500 million 5.875% 10-year senior notes, which priced at a spread of Treasuries plus 325.4 bps on Tuesday, traded better on Wednesday.

The issue was quoted at 314 bps bid, 309 bps offered early during the day's trading.

The specialty metals producer is based in Pittsburgh.

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