Morning Commentary: High-grade bond spreads improve; Bed Bath & Beyond flat; Verizon stable

By Cristal Cody

Tupelo, Miss., July 16 – Investment-grade bond spreads tightened in early trading on Wednesday after spreads widened on Tuesday, market sources said.

The Markit CDX North American Investment Grade series 22 index eased 1 basis point to a spread of 58 bps in the previous session.

In the secondary market, Bed Bath & Beyond Inc.’s offering of senior notes (Baa1/A-/) brought on Monday traded flat but slightly better than issuance, a market source said.

Verizon Communications Inc.’s bonds (Baa1/BBB+/A-) are active but mostly unchanged from a week ago, according to a market source.

Bed Bath & Beyond unchanged

Bed Bath & Beyond’s 3.749% notes due 2024 traded flat at 117 bps offered, a market source said.

The notes were quoted lower at 100.16 in early trading from where the paper closed at 100.22 on Tuesday, according to a market source.

Bed Bath & Beyond sold $300 million of the 10-year notes at Treasuries plus 120 bps on Monday as part of a $1.5 billion three-part offering of notes. The notes priced at 99.999 to yield 3.749%.

The retail store chain is based in Union, N.J.

Verizon stable

Verizon’s 5.15% notes due 2023 traded about 1 bp wider at 108 bps offered, according to a market source.

The issue edged up to 111.80 in early trading from 111.76 on Tuesday, a source said.

Verizon sold $11 billion of the notes at Treasuries plus 225 bps, or 99.676 to yield 5.192%, on Sept. 11, 2013.

The company’s tranche of 6.55% bonds due 2043 was unchanged at 156 bps offered, according to the market source.

The bonds traded lower at 125.05 over the morning from 125.16 on Tuesday, a source said.

Verizon sold $15 billion of the bonds at Treasuries plus 265 bps, or 99.883 to yield 6.559%, in the Sept. 11, 2013 offering.

The telecommunications company is based in New York City.

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