High-grade primary market hosts flurry of issuance; Home Depot, HSBC mostly unchanged

By Aleesia Forni and Cristal Cody

Virginia Beach, Sept. 8 – An onslaught of new issuance hit the investment-grade primary market on Tuesday to open the shortened week.

Taking full advantage of the better market tone, nine borrowers raised $12.71 billion during the session.

Automatic Data Processing Inc. and Bank of Tokyo Mitsubishi UFJ Ltd. each entered the primary with $2 billion new issues, respectively.

Home Depot Inc., meantime, sold $1.5 billion of notes in two parts after scrapping plans for a two-year floating-rate tranche of notes prior to the deal’s launch.

Also on Tuesday, Canadian Pacific Railway Co. issued $1.2 billion of notes in a sale that included a rare 100-year bond, and Santander UK Group Holdings plc sold $1.5 billion of subordinated notes in two parts between 20 basis points and 25 bps tighter than talk.

The busy session also hosted new issues from Goldman Sachs Group Inc., KeyCorp, John Deere Capital Corp. and Indianapolis Power & Light Co.

Investment-grade credit spreads recovered on Tuesday and firmed 3 bps to 4 bps over the day.

In secondary trading, Home Depot’s existing bonds were unchanged to about 2 bps tighter.

Goldman Sachs’s existing paper traded flat on the short end to about 5 bps tighter on the long end.

HSBC Holdings plc’s 4.25% subordinated notes due 2025 were mostly unchanged in late afternoon trading.

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