Morning Commentary: High-grade spreads hold; International Paper flat; Williams paper mixed

By Cristal Cody

Tupelo, Miss., June 23 – Primary action was expected to resume on Monday in the investment-grade bond market with deals on tap for the day from companies including Legg Mason, Inc., DTE Electric Co., Ameren Illinois Co., Healthcare Trust of America and Korea Gas Corp.

Spreads remained on the tight side early Monday, with limited room for narrowing from the current levels, according to a market source.

The Markit CDX North American Investment Grade series 22 index eased 1 basis point to a spread of 57 bps on Friday.

In the secondary market Monday morning, International Paper Co.’s bonds were mostly unchanged after tightening on Friday, a source said.

The Williams Cos. Inc.’s two tranches of senior notes (Baa3/BB+/BBB-) that priced on Thursday were mixed on Monday, according to a market source.

International Paper steady

International Paper’s 4.8% notes due 2044 (Baa2/BBB/) traded unchanged early Monday at 140 bps offered after tightening about 4 bps on Friday, a source said.

The long bonds traded flat at 99.40 over the morning, according to a market source.

International Paper sold $800 million of the bonds on June 3 at 99.479 to yield 4.883%, or Treasuries plus 140 bps.

The paper and packaging manufacturing and distributing company is based in Memphis.

Williams mixed

Williams’ 4.55% notes due 2024 traded about 2 bps tighter at 193 bps bid on Monday, according to a market source.

The notes rose to 100.66 over the morning from 100.37 on Friday, a market source said.

The company sold $1.25 billion of the 10-year notes at Treasuries plus 195 bps, or 99.738 to yield 4.583%, on Thursday.

Williams’ new tranche of 5.75% bonds due 2044 were quoted about 2 bps wider at 232 bps bid, a source said.

The bonds edged up to 100.60 in midday trading from 100.48 on Friday, according to a market source.

Williams sold $650 million of the 30-year bonds at Treasuries plus 230 bps. The bonds priced at 99.773 to yield 5.766%.

The energy infrastructure company is based in Tulsa, Okla.

© 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.