Morning Commentary: Credit Suisse paper firms; Citi eases; high-grade credit spreads flat

By Cristal Cody

Eureka Springs, Ark., May 2 – Investment-grade bonds traded mixed in the secondary market on Monday with some financial markets, including London and Hong Kong, closed for May Day and Labour Day celebrations.

Credit Suisse Group Funding (Guernsey) Ltd.’s senior notes due 2026 improved 2 basis points in the secondary market.

Citigroup Inc.’s 3.4% notes due 2026 traded about 1 bp softer from where the paper was quoted on Friday.

The Markit CDX North American Investment Grade series 23 index opened mostly unchanged at a spread of 77 bps.

The three-month Libor yield was steady at 64 bps.

Secondary trading volume hit $15.49 billion on Friday, according to Trace.

Credit Suisse firms

Credit Suisse Group Funding’s 4.55% notes due 2026 firmed 2 bps to 242 bps offered, according to a market source.

Credit Suisse sold $2 billion of the notes (Baa3/BBB+/A) on April 13 at a spread of 280 bps over Treasuries.

The financial services company is based in Zurich.

Citigroup eases

Citigroup’s 3.4% notes due 2026 (Baa1/BBB+/A) traded about 1 bp softer at 153 bps offered, a market source said.

The notes were quoted on Friday afternoon at 154 bps bid, 152 bps offered in secondary trading.

Citigroup sold $2 billion of the notes on Tuesday at a spread of Treasuries plus 150 bps.

The financial services company is based in New York.

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