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Midday Commentary: Investment-grade spreads improve; J.B. Hunt flat; Time Warner Cable firms
By Cristal Cody
Tupelo, Miss., March 4 - Investment-grade credit spreads tightened early Tuesday after the market showed strong demand for new issuance in the previous session, according to informed sources.
The average book size on the more than $5 billion of high-grade bonds that priced on Monday was nearly five times oversubscribed, a source said.
About $25 billion of investment-grade issuance is expected for the week, according to a market source.
Spreads had widened on Monday on concerns in the Ukraine. The Markit CDX North American Investment Grade series 21 index ended 1 basis point weaker at a spread of 65 bps on Monday.
In the secondary market, J.B. Hunt Transport Services, Inc.'s notes traded mostly unchanged from where the paper headed out in the previous session, according to a market source.
Time Warner Cable Inc.'s notes remain tight in secondary trading, a source said.
J.B. Hunt unchanged
In the secondary market, J.B. Hunt's 3.85% senior notes due 2024 traded unchanged at 122 bps bid, a source said.
The company sold $250 million of the 10-year notes (Baa1/BBB+/) with a spread of Treasuries plus 125 bps on Monday in a $500 million two-part note offering.
J.B. Hunt is a Lowell, Ark.-based full truckload transportation and delivery service company.
Time Warner Cable firms
Time Warner Cable's 4.125% notes due 2021 (Baa2/BBB/BBB) traded better at 70 bps bid early Tuesday, according to an informed source.
The notes have tightened about 2 bps from the previous week.
Time Warner Cable sold $700 million of the notes at Treasuries plus 155 bps in 2010.
The seven-year notes traded as wide as the 215 bps area in February before the company announced that it will be acquired by Comcast Corp. in a $45.2 billion all-stock deal.
New York City-based Time Warner Cable is a broadband communications company.
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