Morning Commentary: Duke Energy firms in secondary trading; credit spreads steady at open

By Cristal Cody

Eureka Springs, Ark., June 21 – Investment-grade market participants were mostly focused Tuesday morning on Federal Reserve chairman Janet Yellen’s U.S. Senate testimony on monetary policy.

Yellen also is scheduled to present the semiannual monetary policy report to the U.S. House of Representatives on Wednesday.

In the secondary market, Duke Energy Ohio, Inc.’s new 3.7% first mortgage bonds due 2046 that priced on Monday traded 2 basis points better than issuance.

The Markit CDX North American Investment Grade index opened unchanged to modestly softer at a spread of 80 bps.

The three-month Libor yield was stable over the morning at 64 bps.

On Monday, $11.67 billion of high-grade issues were traded, according to Trace.

Duke Energy Ohio’s 3.7% first mortgage bonds due 2046 traded 2 bps better in the secondary market at 123 bps offered, according to a market source.

The company sold $250 million of the bonds (A2/A/A) on Monday at a spread of 125 bps over Treasuries.

The Charlotte, N.C.-based company generates, transmits, distributes and sells electricity and is a wholly owned subsidiary of Duke Energy Corp.

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