Morning Commentary: European Investment Bank, Old Republic to price; Microsoft, Oracle soften

By Cristal Cody

Eureka Springs, Ark., Aug. 23 – New high-grade supply on Tuesday is expected to include an offering of five-year global notes from the European Investment Bank.

The notes are guided to price at mid-swaps plus 27 basis points, according to a news release.

Also, Old Republic International Corp. plans to price senior notes.

Investment-grade bonds were mixed in the secondary market.

Microsoft Corp.’s 2.4% senior notes due 2026 that priced at the start of the month traded about 2 bps weaker early Tuesday.

Oracle Corp.’s 2.65% senior notes due 2026 brought to market earlier in the summer softened about 1 bp.

The Markit CDX North American Investment Grade index opened mostly unchanged at a spread of 72 bps.

The three-month Libor yield was stable at 82 bps.

On Monday, $10.32 billion of investment-grade issues were traded, according to Trace.

Microsoft softens

Microsoft’s 2.4% notes due 2026 were trading about 2 bps weaker at 77 bps offered on Tuesday, according to a market source.

The company sold $4 billion of the notes (Aaa/AAA) on Aug. 1 at a spread of 90 bps over Treasuries.

The computer software company is based in Redmond, Wash.

Oracle eases

Oracle’s 2.65% notes due 2026 eased about 1 bp to 97 bps offered in the secondary market, a source said.

The company sold $3 billion of the notes (A1/AA-) on June 29 at Treasuries plus 120 bps.

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

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