Morning Commentary: Investment-grade bond spreads stable; Verizon firms; eBay eases

By Cristal Cody

Tupelo, Miss., July 25 – Investment-grade bond spreads opened on Friday unchanged to slightly wider, while trading activity is expected to stay light over the session, according to market sources.

The Markit CDX North American Investment Grade series 22 index closed on Thursday unchanged at a spread of 59 basis points.

“Credit market conditions make it a good time for a fixed income guy to go on vacation,” RBC Capital Markets, LLC analysts said in a note.

Verizon Communications Inc.’s bonds continue to be actively traded following the company’s announcement that it plans to exchange as much as $12 billion of new notes for existing debt, a source said.

The company’s 6.55% bonds due 2043 tightened 7 bps in secondary trading, a market source said. The bonds are among the 11 issues Verizon plans to exchange, according to a company statement late Wednesday.

eBay Inc.’s 3.45% notes due 2024 brought in Wednesday’s session traded flat to 1 bp weaker Friday morning, a source said.

Verizon stable

Verizon’s 6.55% bonds due 2043 (Baa1/BBB+/A-) tightened to 154 bps offered, a source said.

The bonds traded on Thursday at 161 bps offered.

Verizon sold $15 billion of the bonds at a spread of Treasuries plus 265 bps on Sept. 11, 2013.

The telecommunications company is based in New York City.

eBay eases

eBay’s 3.45% notes due 2024 (A2/A/A) were quoted at 101 bps offered early Friday, according to a market source.

The company sold $750 million of the notes at Treasuries plus 100 bps on Wednesday in a $3.5 billion five-part offering of senior notes.

The global online commerce and payments platform company is based in San Jose, Calif.

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