Morning Commentary: American Express, Northern Trust on tap; Pacific Gas holds calls

By Cristal Cody

Tupelo, Miss., July 31 – Some pricing action is expected over Tuesday’s session in the high-grade bond market.

American Express Co. (A3/BBB+/A) is offering five-year fixed- and floating-rate tranches of notes in the company’s third reported bond offering of the year.

In addition, Northern Trust Corp. (A2/A+/AA-) plans to price new senior notes in the company’s first investment-grade bond offering in 2018. Northern Trust previously priced $350 million of fixed-to-floating rate notes on May 3, 2017.

Also on Tuesday, Pacific Gas & Electric Co. (A3/BBB/BBB+) is holding fixed income investor calls, a market source said.

Goldman Sachs & Co. LLC, Mizuho Securities USA LLC, RBC Capital Markets, LLC and SMBC Nikko Securities America, Inc. are the arrangers.

The San Francisco-based electric and natural gas utility tapped the primary market twice in 2017, with the most recent issuance on Nov. 27, 2017 when it sold $2.5 billion of senior notes in three tranches.

Week to date, deal volume totals less than $3 billion following new issuance on Monday from Norfolk Southern Corp., Southern California Edison Co. and Ryder System, Inc.

Market sources forecast about $15 billion to as much as $25 billion of bond supply for the week.

Investor focus centers this week on monetary policy meetings from the Federal Reserve, Bank of England and Bank of Japan. The Federal Open Market Committee starts its two-day meeting on Tuesday.

In other activity, the previous session ended with $16.82 billion of high-grade bonds traded in the secondary market, according to Trace.

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