Morning Commentary: High-grade bond market quiet; $15 billion-$25 billion supply eyed

By Cristal Cody

Tupelo, Miss., April 22 – Investment-grade market action got off to a quiet start on Monday following the long Good Friday holiday weekend.

No reported issuers were offering bonds at the start of the session.

Last week, bank and financial supply was in focus with deals from issuers including Bank of America Corp., Citigroup Inc. and JPMorgan Chase & Co.

The four largest U.S. banks issued $8.75 billion of dollar-denominated notes, €1 billion of euro-denominated notes and C$1 billion of Canadian dollar-denominated notes following first-quarter earnings reports last week, while the “brokers have not yet,” BofA Merrill Lynch analysts note in a report released on Friday.

Industrial issuers are expected to remain out of the primary market this week.

“The industrial calendar should remain relatively quiet as most U.S. HG companies are in earnings-related issuance blackouts,” the analysts said.

The week has seen an historic seasonal supply amount of about $15 billion to $25 billion of bond issuance, the analysts said.

Corporate issuers priced about $19 billion of investment-grade bonds last week ahead of the early market close on Thursday and Friday’s holiday.

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