Midday Commentary: Apple's new bonds remain trading centerpiece; IBM bonds seen mixed

By Andrea Heisinger

New York, May 3 - Nearly $35 billion of investment-grade bonds were priced during the week, with no new deals announced to end the week.

A jobs report for April was released early in the day by the U.S. Department of Labor, showing a drop in unemployment to 7.5%.

Meanwhile, the secondary side of the market was seeing a "lot of trading" at midday, a source said.

The $17 billion of Apple Inc. bonds that were sold Wednesday remained active.

"That's the centerpiece of the market," a trader said.

Since the bonds broke, the 1% notes due 2018 were seen tighter, while the 2.4% 10-year notes were quoted "marginally tighter" by the trader.

The 3.85% 30-year bonds were seen 1 basis point to 2 bps tighter than their Treasuries plus 100 bps price.

International Business Machines Corp. saw its $2.25 billion of bonds in tranches due 2016 and 2020 mixed in the secondary.

The $1 billion of 0.45% three-year notes were quoted 1 bp wider at 26 bps, after being seen unchanged after pricing Thursday. The notes were priced at Treasuries plus 25 bps.

IBM's 1.625% seven-year bonds were seen 5 bps tighter at 62 bps bid, 64 bps offered. This was an improvement on the 65 bps spread the paper was quoted at late Thursday.

Pricing was at 67 bps over Treasuries.

The information technology and computer company is based in Armonk, N.Y.

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