Morning Commentary: Bond spreads mostly flat to tighter; Old Republic bonds trade better

By Aleesia Forni

Virginia Beach, Sept. 24 – Bond spreads in the investment-grade secondary market were mostly flat to slightly tighter early Wednesday.

The Markit CDX North American Investment Grade series 22 index was unchanged at a spread of 60 basis points.

Meanwhile, issuance in the primary market will continue on Wednesday, with new deal announcements from Ensco plc, Dominion Resources Inc. and Abbey National Treasury Services plc.

The secondary market saw Old Republic International Corp.’s recent $400 million of 4.875% senior notes (Baa3/BBB+/) trade better on Wednesday, a trader said.

The 10-year notes, which were sold on Monday at Treasuries plus 237.5 bps, were quoted at 236 bps bid, 234 bps offered.

The upsized deal priced at 99.498 to yield 4.939%, with Morgan Stanley & Co. LLC and Credit Suisse Securities (USA) LLC as the bookrunners.

The Chicago-based insurance holding company plans to use the proceeds from the offering for general corporate purposes.

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