Investment-grade primary issuance halts; Freddie Mac passes; Home Depot, Citigroup weaken

By Aleesia Forni and Cristal Cody

New York, Feb. 9 – Another tumultuous session kept the investment-grade primary market empty of any new issuance on Tuesday, while credit spreads were largely wider during the trading day ahead of Federal Reserve chair Janet Yellen’s testimony in Congress on Wednesday morning.

Meantime, Freddie Mac announced that it would forgo issuing Reference Notes on its Feb. 9 announcement date.

A source noted that any issuance activity for the remainder of the week was “a tough call” due to the ongoing rocky market backdrop.

So far, only one deal has priced this week. Ford Motor Credit Co. LLC issued $115 million of notes in three parts on Monday.

Most sources had called for around $10 billion to $15 billion of new investment-grade paper to price during the week.

In the secondary market, Home Depot Inc.’s 3% notes due 2026 eased 5 basis points to 116 bps bid over the day, a market source said, and its 4.25% notes due 2046 traded 2 bps softer at 147 bps bid.

Citigroup Inc.’s 3.7% subordinated notes due 2026 eased 3 bps to 199 bps bid.

AT&T Inc.’s new 4.125% notes due 2026 eased 5 bps to 227 bps bid in secondary trading, and its 5.65% bonds due 2047 widened 10 bps over the session to 303 bps bid.

The Markit CDX North American Investment Grade index closed 1 bp softer at a spread of 121 bps.

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