Toyota, O’Reilly, Southern Gas price; HSBC, GlaxoSmithKline offer notes; Barclays improves

By Cristal Cody

Tupelo, Miss., May 10 – Investment-grade issuers including Toyota Motor Credit Corp., O’Reilly Automotive, Inc. and Southern California Gas Co. tapped the primary market on Thursday.

Toyota Motor Credit sold $1.9 billion of floating-rate notes in two tranches.

O’Reilly Automotive priced $500 million of 10-year senior notes.

Southern California Gas sold $400 million of 30-year first mortgage bonds.

In addition, HSBC Holdings plc and GlaxoSmithKline plc were marketing major bond deals during the session.

More than $31 billion of high-grade bonds have priced week to date.

Syndicate sources expected about $30 billion to $35 billion of bond issuance for the week.

The Markit CDX North American Investment Grade 30 index tightened about 2 basis points over the day to a spread of 60 bps.

In the secondary market, Barclays plc’s paper traded about 2 bps to 4 bps tighter on Thursday following the company’s $4.5 billion three-part note sale in the previous session, a market source said.

HSBC’s existing notes were mixed, trading about 1 bp wider to 2 bps tighter, according to the market source.

Elsewhere, bank and financial paper overall was mostly flat on the day.

General Dynamics Corp.’s $7.5 billion of senior notes (A2/A+/A) brought to the market in seven tranches on Tuesday have tightened about 8 bps to 10 bps in the secondary market, another source said.

O’Reilly sells $500 million

O’Reilly Automotive sold $500 million of 4.35% 10-year senior notes (Baa1/BBB/) on Thursday at a spread of Treasuries plus 140 bps, according to an FWP filing with the Securities and Exchange Commission.

The notes priced at 99.732 to yield 4.383%.

Bookrunners were J.P. Morgan Securities LLC, U.S. Bancorp Investments Inc., BofA Merrill Lynch and Wells Fargo Securities LLC.

O’Reilly Automotive is a Springfield, Mo.-based retailer of automotive aftermarket products.

Southern California Gas prices

Southern California Gas sold $400 million of 4.125% 30-year first mortgage bonds on Thursday at 99.895 to yield 4.131%, according to an FWP filed with the SEC.

The bonds priced with a spread of 100 bps over Treasuries.

BNP Paribas Securities Corp., Mizuho Securities USA Inc., SMBC Nikko Securities America Inc., U.S. Bancorp Investments and Loop Capital Markets LLC were the bookrunners.

The natural gas distributor is based in Los Angeles.

Funds again in the green

Among mutual funds and exchange-traded funds, investment-grade corporate portfolios once more saw an inflow, adding $0.804 billion of cash in the week to May 9, according to fund-flow statistics generated by AMG Data Services Inc.

That was a little lower than the previous week’s $0.997 billion which in turn followed additions of $2.010 billion, $1.535 billion and $3.346 billion, as reported by the Arcata, Calif.-based unit of Thomson Reuters Corp’s Lipper analytics division.

The IG funds have now seen nine straight inflows.

Apart from the Feb. 14 and Feb. 21 weeks, every week so far this year has seen positive flows and in fact before those two weeks in February investment-grade corporates saw a 21-week run of inflows dating back to mid-September, according to a Prospect News analysis of the data.

The latest gains raise the year-to-date inflow for the IG corporates to $39.83 billion from $39.03 billion, another new peak for the year so far.

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