Morning Commentary: Bank of America, Berkshire Hathaway, Exxon Mobile firm; CDX opens strong

By Cristal Cody

Eureka Springs, Ark., March 11 – High-grade bonds traded mostly better in the secondary market, while credit spreads opened Friday’s session 5 basis points tighter, sources report.

Bank of America Corp.’s 4.45% medium-term subordinated notes due 2026 that priced at the end of February traded about 6 bps better early Friday and 20 bps tighter than issuance.

Berkshire Hathaway Inc.’s 3.125% senior notes due 2026 improved 5 bps in early secondary trading.

Exxon Mobil Corp.’s 3.043% notes due 2026 were quoted 3 bps better at the start of the session.

The Markit CDX North American Investment Grade index opened the day 5 bps tighter at a spread of 86 bps.

Three-month Libor fell 1 bp early Friday to 63 bps.

On Thursday, $18.66 billion of high-grade issues were traded, down from Wednesday’s $20.84 billion, according to Trace.

Bank of America stronger

Bank of America’s 4.45% subordinated notes due 2026 tightened about 6 bps to 250 bps offered, a market source said.

Bank of America sold $2 billion of the notes on Feb. 29 at a spread of 270 bps.

The financial services company is based in Charlotte, N.C.

Berkshire tightens

Berkshire Hathaway’s 3.125% notes due 2026 firmed 5 bps from Thursday’s session to 108 bps offered, a market source said.

The company sold $2.5 billion of the notes (Aa2) on Tuesday at 130 bps over Treasuries.

Berkshire Hathaway is an Omaha-based holding company for subsidiaries.

Exxon Mobil firms

Exxon Mobil’s 3.043% notes due 2026 traded about 3 bps better early Friday at 108 bps offered, a market source said.

The company sold $2.5 billion of the notes (Aaa/AAA) on Feb. 29 at 130 bps over Treasuries.

Exxon Mobil is an energy company based in Irving, Texas.

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