Investment-grade primary empty during brutal session; AT&T, Apple weak; Oracle steady

By Aleesia Forni and Cristal Cody

Virginia Beach, Aug. 24 – The investment-grade primary market was silent during a brutal session for the broader market.

U.S. stocks plunged on Monday amid a global sell-off on fears of slowing economic growth in China.

No new issues priced during the rollercoaster session, beginning what was already predicted to be a quiet week for the market.

Meantime, Deutsche Bank AG gave details of a recently priced $75 million add-on to its floating-rate notes due 2020.

Sources predict the remainder of the week to be empty of new issuance ahead of what is expected to be a hefty month of supply for September.

Investment-grade credit spreads continued to weaken on Monday.

The Markit CDX North American Investment Grade index opened the session wider at a spread of 86 basis points and headed out weaker at 88 bps. The index closed on Friday 2 bps softer at a spread of 83 bps.

In the secondary market, AT&T Inc.’s bonds (/BBB+/A-) remain weak.

Apple Inc.’s bonds (Aa1/AA+) continue to trade wider.

Oracle Corp.’s senior notes (A1/AA-/A+) were mostly unchanged over the day.

Deutsche Bank does add-on

Deutsche Bank gave details of a $75 million add-on to its existing floating-rate notes due Aug. 20, 2020 in a 424B2 filed with the Securities and Exchange Commission.

The notes priced on Aug. 20 at par to yield Libor plus 131 bps.

The issue’s total size is now $375 million, including $300 million of notes (A3/BBB+/A) priced on Aug. 17.

Deutsche Bank Securities Inc. is the bookrunner.

The bank is based in Frankfurt.

AT&T weakens

AT&T’s 3.4% notes due 2025 traded in the 205 bps bid area on Monday, a market source said.

The company sold $5 billion of the notes on April 23 at a spread of Treasuries plus 150 bps.

AT&T’s 4.75% bonds due 2046 remain weak at 264 bps bid.

AT&T sold $3.5 billion of the bonds in the April 23 offering at Treasuries plus 215 bps.

The telecommunications company is based in Dallas.

Apple softens

Apple’s 3.2% notes due 2025 headed out on Monday at 124 bps bid in the secondary market, a source said.

The company sold $2 billion of the notes on May 6 at a spread of Treasuries plus 100 bps.

Apple’s 4.375% notes due 2045 were wider at 168 bps bid in secondary trading.

The company sold a $2 billion tranche of the bonds in the May 6 deal at 140 bps over Treasuries.

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

Oracle steady

Oracle’s 2.95% notes due 2025 were mostly unchanged on Monday at 133 bps bid, a market source said.

Oracle sold $2.5 billion of the notes on April 28 at a spread of 100 bps over Treasuries.

The company’s tranche of 4.125% bonds due 2045 were flat at 159 bps bid.

Oracle sold $2 billion of the bonds in the April 28 offering at Treasuries plus 145 bps.

The computer software and technology company is based in Redwood City, Calif.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.