Morning Commentary: High-grade credit spreads open wider; Citi improves; AT&T firms

By Cristal Cody

Tupelo, Miss., Oct. 9 – Investment-grade credit spreads opened about 1 basis point weaker on Thursday with high-grade bonds mixed in early trading, market sources said.

The Markit CDX North American Investment Grade series 23 index closed on Wednesday 3 basis points tighter at a spread of 67 bps. The CDX index was quoted about 1 bp wider early Thursday.

In the secondary market, Citigroup Inc.’s 2.5% notes due 2019 traded about 1 bp tighter, a source said.

AT&T Inc.’s 4.8% notes due 2044 tightened 2 bps over the morning from where the notes headed out on Wednesday, according to a market source.

Citigroup firms

Citigroup’s 2.5% notes due 2019 tightened about 1 bp from where the notes went out on Wednesday to 80 bps offered, a market source said.

The notes (Baa2/A-/A) firmed about 4 bps on Wednesday to 81 bps offered, a source said.

Citigroup sold $2 billion of the notes on July 22 at a spread of Treasuries plus 85 bps.

The bank is based in New York.

AT&T tightens

AT&T’s 4.8% notes due 2044 were quoted 2 bps tighter at 162 bps offered, a source said.

The notes (A3/A-/A) traded 4 bps wider at 164 bps offered on Wednesday, a source said.

AT&T sold $2 billion of the 30-year bonds at a spread of Treasuries plus 140 bps on June 3.

The telecommunications company is based in Dallas.

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