Morning Commentary: High-grade primary market slows ahead of holiday; Union Pacific mixed

By Cristal Cody

Tupelo, Miss., April 7 – Primary action in the high-grade bond market is expected to stay light on Friday and continue to remain thin in the upcoming shortened holiday week.

The bond markets will close early on Thursday and will be closed entirely on April 14 for the Good Friday holiday.

Syndicate sources expect about $10 billion of deal volume for the week ahead with most of the issuance likely in the first two sessions.

In the investment-grade secondary bond market early Friday, Union Pacific Corp.’s senior notes (A3/A) were mixed.

High-grade secondary market volume totaled $17.1 billion on Thursday, Trace reported.

Union Pacific mixed

Union Pacific’s 3% notes due April 15, 2027 traded better over the morning to as high as 99.89 after going out at 99.47 on Thursday, according to a market source.

Union Pacific priced $500 million of the 10-year notes on March 29 at 98.608 to yield 3.163% and a spread of 77 basis points over Treasuries.

The company’s 4% notes due April 15, 2047 were unchanged from the previous day at 99.43.

Union Pacific sold $500 million of the 30-year notes in the March 29 offering at 98.655 to yield 4.078%, or a spread of Treasuries plus 107 bps.

The railroad transportation company is based in Omaha.

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