Investment-grade primary wraps $47 billion week; funds see first inflows in seven weeks

By Aleesia Forni and Cristal Cody

Virginia Beach, Sept. 11 – The investment-grade primary market was empty of new issuance on Friday, giving the market a breather following the more than $47 billion of paper priced during the shortened week.

Issuers raced to the primary during the three active sessions this week to price deals ahead of next week’s Federal Reserve policy meeting and a potential rake hike.

Also this week, Lipper reported the first inflows seen for corporate investment-grade bond funds in seven weeks.

For the week ended Sept. 9, $416 million flowed into the funds, following last week’s $2.27 billion of outflows, pushing the year-to-date total to $21.32 billion of inflows.

Sources expect primary activity to slow in the week ahead, with around $25 billion to $30 billion of supply predicted.

Molson Coors Capital Finance ULC (Baa2/BBB+/DBRS: BBB) priced a rare Canadian dollar-denominated bond deal on Friday, according to market sources.

BMO Nesbitt Burns Inc. was a bookrunner.

Molson Coors Capital Finance is a Halifax, N.S.-based financing arm of the Denver-based Molson Coors Brewing Co.

Final pricing details were not available by press time.

In secondary trading on Friday, Goldman Sachs Group Inc.’s new 2.75% senior notes due 2020 traded about 3 bps tighter than where the paper priced earlier in the week.

Home Depot Inc.’s new 3.35% senior notes due 2025 were mostly unchanged over the session but remain better than where the bonds came on Tuesday.

Automatic Data Processing Inc.’s 3.375% senior notes due 2025 traded mostly flat but tighter than issuance.

The Markit CDX North American Investment Grade index closed unchanged at a spread of 80 bps.

Goldman stable

Goldman Sachs’ 2.75% notes due 2020 were quoted in late afternoon trading in the secondary market at 124 bps bid, 120 bps offered, a trader said.

Goldman Sachs sold $1.25 billion of the notes on Tuesday (A3/A-/A) at Treasuries plus 127 bps.

The financial services company is based in New York City.

Home Depot steady

Home Depot’s 3.35% notes due 2025 headed out mostly unchanged at 109 bps bid, 108 bps offered, according to a trader.

Home Depot sold $1 billion of the notes (A2/A/A) on Tuesday at a spread of 117 bps over Treasuries.

The home improvement retailer is based in Atlanta.

ADP mostly unchanged

Automatic Data Processing’s 3.375% notes due 2025 traded late on Friday at 112 bps bid, 109 bps offered, a trader said.

The company sold $1 billion of the notes (Aa3/AA) on Tuesday at Treasuries plus 120 bps.

The Roseland, N.J.-based company provides business process outsourcing services, including payroll and benefits administration services.

© 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.