Investment-grade primary quiet; bank, financial paper firms; Amazon.com, Kroger unchanged

By Cristal Cody

Tupelo, Miss., Aug. 25 – Investment-grade bond market activity slowed on Friday with no issuance reported during the session.

Corporate and SSA issuers priced about $13.55 billion of bonds over the week.

Market focus early on Friday was on Federal Reserve Chairman Janet Yellen’s Jackson Hole, Wyo., speech at the annual central bank symposium.

The Markit CDX North American Investment Grade index closed the day slightly tighter at a spread of 59.7 basis points.

In the secondary market, bank and financial paper traded mostly better on Friday.

Barclays’ notes were seen about 1 bp to 6 bps tighter.

HSBC Holdings plc’s paper firmed about 3 bps.

Grocery retail bonds were mostly steady on the day ahead of Amazon.com, Inc.’s $13.7 billion cash acquisition of Whole Foods Markets Inc. expected to close on Monday.

Amazon.com’s 3.15% notes due Aug. 22, 2027 priced in a $16 billion seven-tranche deal on Aug. 15 were flat.

Whole Foods’ 5.2% notes due Dec. 3, 2025 tightened 5 bps.

Kroger Co.’s 3.7% notes due 2027 headed out unchanged.

HSBC tightens

HSBC Holdings’ 4.3% notes due 2026 firmed about 3 bps on Friday to 113 bps bid, a market source said.

HSBC sold $3 billion of the notes (A1/A/AA-) on March 1, 2016 at a spread of 250 bps over Treasuries.

The banking and financial services group is based in London.

Amazon.com flat

Amazon.com’s 3.15% notes due Aug. 22, 2027 traded flat on the day at 87 bps bid, according to a market source.

Amazon.com sold $3.5 billion of the notes (Baa1/AA-/) on Aug. 15 as part of a $16 billion seven-tranche deal at a spread of Treasuries plus 90 bps.

The online commerce company is based in Seattle.

Whole Foods firms

Whole Foods Market’s 5.2% notes due Dec. 3, 2025 (Baa3/BBB-/) traded 5 bps better from the previous session at 81 bps bid on Friday, according to a market source.

Whole Foods sold $1 billion of the notes on Nov. 30, 2015 at a spread of Treasuries plus 300 bps.

The organic and natural foods grocery retailer is based in Austin, Texas.

Kroger stable

Kroger’s 3.7% notes due 2027 were flat at 148 bps bid on Friday after tightening 3 bps in the previous session, a market source said.

The company sold $600 million of the notes (Baa1/BBB/BBB) on July 17 at a Treasuries plus 140 bps spread.

Kroger is a Cincinnati-based grocery retailer.

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