Morning Commentary: Goldman Sachs offers notes; steady supply eyed; fund inflows rise

By Cristal Cody

Tupelo, Miss., Dec. 4 – The high-grade primary market mostly quieted early Friday with one reported issuer marketing bonds.

Goldman Sachs Group Inc. is offering senior notes (A3/BBB+/A) in two tranches on Friday, a source said.

More than $19 billion of corporate bonds have priced week to date, closing in on the wide end of the $15 billion to $20 billion of issuance anticipated by market participants for the week.

Steady supply is expected next week with another $15 billion to $20 billion of high-grade bonds estimated to print in what may be the final busy week of the year, syndicate sources said.

ETF inflows decrease

Elsewhere, overall investment-grade bond fund and ETF inflows climbed to $6.21 billion for the past week ended Wednesday from $5.67 billion in the previous week, according to a BofA Securities, Inc. research note released on Friday.

Fund inflows jumped to $5.04 billion from $1.78 billion a week earlier.

Short-term inflows totaled $520 million from outflows of $60 million in the prior week, while excluding short-term inflows fell to $5.68 billion from $5.73 billion.

ETFs inflows declined to $1.16 billion this past week from $3.89 billion last week, according to the report.

Market tone was mixed on Friday morning on disappointing U.S. job numbers.

The Labor Department reported that total nonfarm payroll employment rose by 245,000 in November, while the unemployment rate fell in line with forecasts to 6.7%, down 8 percentage points from the high in April and 3.2 percentage points higher than it was in February before the pandemic.

Market analysts expected a 470,000 jobs gain.

The iShares iBoxx Investment Grade Corporate Bond ETF fell 0.60% to $136.93.

The Pimco Investment Grade Corporate Bond index softened 0.21% to $116.54.

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