Morning Commentary: High-grade spreads firm in early trading; RBC bonds tighten

By Aleesia Forni

Virginia Beach, Sept. 18 – High-grade bond spreads traded mostly better early during Thursday’s session.

The Markit CDX North American Investment Grade series 22 index was 1 basis point tighter at a spread of 58 bps.

In primary happenings, new bank and financial paper is expected to price over the day from Mizuho Bank Ltd. and American Express Credit Corp.

In the secondary market, the recently priced covered bond from Royal Bank of Canada continued to trade better on Thursday.

The new $1.75 billion 2.2% five-year bond firmed 2 bps in the secondary market to 40 bps bid, a trader said.

The notes (expected: Aaa/AAA/AAA) priced with a spread of Treasuries plus 43.7 bps, or mid-swaps plus 27 bps, on Tuesday.

RBC is a Toronto-based financial services company.

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