Morning Commentary: Investment-grade credit spreads stable; Apple mostly flat; Verizon eases

By Cristal Cody

Tupelo, Miss., Oct. 28 – High-grade credit spreads remained unchanged to modestly better early Tuesday ahead of the Federal Reserve’s monetary policy report on Wednesday, sources said.

Market participants widely expect the Fed to announce the end of the government’s quantitative easing program.

The Markit CDX North American Investment Grade series 23 index closed on Monday flat at a spread of 65 basis points.

In the secondary market early Tuesday, Apple Inc.’s 2.85% notes due 2021 brought in April were active but flat to about 1 bp wider, a source said.

In other secondary activity, Verizon Communications Inc.’s 3.5% senior notes due 2024 traded about 3 bps weaker than where the notes priced a week ago, according to a market source.

Apple mostly unchanged

Apple’s 2.85% notes due 2021 (Aa1/AA+/) eased 1 bp to 60 bps offered in secondary trading, a source said early Tuesday.

The company sold $3 billion of the seven-year notes at a spread of Treasuries plus 60 bps on April 29.

The computer and mobile communications device company is based in Cupertino, Calif.

Verizon 10-year notes ease

Verizon’s 3.5% notes due 2024 (Baa1/BBB+/A-) eased 1 bp from the previous session to 138 bps offered, a market source said.

Verizon sold $2.5 billion of the notes on Oct. 22 at Treasuries plus 135 bps.

The telecommunications company is based in New York City.

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