Primary market empty to close $47 billion week; General Electric firms; Viacom better

By Cristal Cody and Aleesia Forni

Virginia Beach, March 7 - The high-grade bond market saw no new deals price on Friday, closing a frenzied week that saw more than $47 billion of new paper price.

Even with the staggering issuance the high-grade primary market has seen this week, demand for new issues remains solid.

Lipper analytics reported an inflow of $2.476 billion into corporate investment-grade funds for the week ended Wednesday.

Also on Friday, players were focused on the release of the stronger-than-expected non-farm payrolls report.

The economy added 175,000 jobs during the month of February, compared to expectations of 149,000. The unemployment rate rose to 6.7% in February compared to 6.6% in January.

The high-grade market's momentum is expected to continue in the coming weeks, sources said.

"Expecting around $25 billion next week," one market source said Friday.

After the storm of issuance over the week, investment-grade bond spreads held up "pretty good overall," a trader said. "Big week."

General Electric Co.'s 3.375% senior notes due 2024 tightened 2 basis points from where the issue priced on Thursday, a trader said.

Viacom Inc.'s five-year and 10-year notes brought on Tuesday traded better on the offered side, while the 30-year tranche was not seen in late day trading, according to a trader.

General Electric notes tighten

General Electric's 3.375% notes due 2024 tightened to 73 bps bid, 71 bps offered as the session closed, a trader said on Friday.

The company sold $750 million of the notes (Aa3/AA+/) at Treasuries plus 75 bps on Thursday as part of a $3 billion two-part offering.

The infrastructure and financial services company is based in Fairfield, Conn.

Viacom better

Viacom's 2.2% senior notes due 2019 traded at 65 bps offered on Friday, a trader said.

The company sold $400 million of the notes at Treasuries plus 67 bps in a $1.5 billion three-tranche offering of senior notes (Baa2/BBB/BBB+) on Tuesday.

Viacom's 3.875% senior notes due 2024, brought in a $550 million offering at Treasuries plus 127 bps, was better at 123 bps offered, according to the trader.

"Didn't see the 30-year," the trader said.

The entertainment content company is based in New York City.

Bank/brokerage CDS mixed

Investment-grade bank and brokerage CDS prices were mixed, according to a market source.

Bank of America Corp.'s CDS costs eased 1 bp to 64 bps bid, 67 bps offered. Citigroup Inc.'s CDS costs rose 1 bp to 75 bps bid, 78 bps offered. JPMorgan Chase & Co.'s CDS costs were unchanged at 56 bps bid, 59 bps offered. Wells Fargo & Co.'s CDS costs were flat at 38 bps bid, 43 bps offered.

Merrill Lynch's CDS costs eased 1 bp to 66 bps bid, 69 bps offered. Morgan Stanley's CDS costs firmed 1 bp to 84 bps bid, 87 bps offered. Goldman Sachs Group, Inc.'s CDS costs ended flat at 89 bps bid, 92 bps offered.

Paul Deckelman contributed to this review.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.