Morning Commentary: Charter Communications notes on tap; Occidental gains continue

By Abigail W. Adams

Portland, Me., July 6 – While the domestic high-yield primary market is expected to cool its pace after a record-setting June, it rolled out a megadeal in the return from the holiday weekend.

Charter Communications Operating LLC plans to price $1.5 billion of long 10-year senior notes in a Monday drive-by.

Early whispers have the notes coming in the 4 3/8% area, a market source said.

Opportunistic issuers are expected to continue to tap the market as long as conditions remain favorable, sources said.

And conditions were favorable on Monday with the secondary space launching the July 6 week on firm footing.

Occidental Petroleum Corp.’s 8 7/8% senior notes due 2030 (Ba2/BB+/BB) continued to gain in active trading.

The largest and most liquid tranches of Occidental’s recent megadeal gained about 1 point.

The notes were changing hands in the 103½ to 104 context early in the session.

After a weak start in the aftermarket, the notes steadily gained throughout last week with better credit energy names on the rise alongside crude oil futures.

WTI crude oil futures were largely flat early Monday at $40.64.

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