Morning Commentary: Investment-grade bonds mixed; McDonald’s flat; Microsoft paper eases

By Cristal Cody

Tupelo, Miss., Dec. 10 – High-grade bonds opened the day mixed, trading mostly flat to softer in the secondary market on Thursday.

McDonald’s Corp.’s 4.7% senior notes due 2035 were mostly unchanged.

Microsoft Corp.’s 4.45% senior notes due 2045 eased 4 basis points.

The Markit CDX North American Investment Grade 25 index was unchanged at the start of the day at a spread of 86 bps.

The three-month Libor yield rose 1 bp to 49 bps early Thursday.

McDonald’s steady

McDonald’s 4.7% bonds due 2035 were mostly unchanged in early secondary trading at 170 bps offered, according to a market source.

The company sold $750 million of the bonds (Baa1/BBB+/BBB+) on Dec. 2 at a spread of Treasuries plus 180 bps.

The fast food chain is based in Oak Brook, Ill.

Microsoft softens

Microsoft’s 4.45% bonds due 2045 were quoted trading 4 bps weaker at 128 bps offered, according to a market source.

Microsoft sold $3 billion of the bonds (Aaa/AAA/AA+) on Oct. 29 at Treasuries plus 150 bps.

The computer software company is based in Redmond, Wash.

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