Investment-grade bond market activity slows; Amazon improves; credit spreads modestly better

By Cristal Cody

Tupelo, Miss., Dec. 24 – Investment-grade bonds were mixed in thin pre-holiday trading on Wednesday, market sources said.

Amazon.com, Inc.’s 4.95% senior notes due 2044 priced in early December traded 2 basis points tighter, a source said.

Gilead Sciences Inc.’s 4.5% senior notes due 2045 were mostly unchanged with little secondary action seen in the notes, according to a market source.

The Markit CDX North American Investment Grade series 23 index headed out flat to less than ½ bp tighter at a spread of 64 bps, a source said.

Amazon tightens

In the secondary market, Amazon.com’s 4.95% notes due 2044 (Baa1/AA-/) firmed 2 bps to 198 bps offered, a source said.

The notes traded higher at 103.411 to yield 4.734% late Wednesday compared to where the bonds ended at 101.8 to yield 4.835% in the previous session, according to a market source.

Amazon.com sold $1.5 billion of the notes at 99.236 to yield 5.065% and with a spread of Treasuries plus 205 bps on Dec. 2.

The online retailer is based in Seattle.

Gilead Sciences stable

Gilead Sciences’ 4.5% notes due 2045 (A3/A-/) traded flat to 1 bp softer at 137 bps offered, according to a market source.

The notes saw little activity over the day and traded late afternoon at 104.863 to yield 4.21% from 104.689 to yield 4.22% in Tuesday’s session, a source said.

Gilead Sciences sold $1.75 billion of the bonds at Treasuries plus 145 bps on Nov. 12. The bonds priced at 99.413 to yield 4.535%.

The biopharmaceutical company is based in Foster City, Calif.

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