High-grade primary market winds down; PacifiCorp, Steel Dynamics improve; Dominion Gas flat

By Cristal Cody

Tupelo, Miss., Dec. 23 – The high-grade bond market is effectively shut for the rest of the year with little market activity reported on Monday, two days before the Christmas Day holiday.

The bond markets will close early at 2 p.m. ET on Tuesday and remain closed on Wednesday for the Christmas holiday.

Quite a few market participants already have left offices for the rest of the year with some desks thinly staffed, sources report.

No issuance is forecast this week, following zero bond deal volume last week, according to syndicate sources.

December high-grade corporate bond supply so far has totaled more than $20 billion.

The Markit CDX North American Investment Grade 33 index finished Monday mostly unchanged to modestly tighter at a spread of 45.05 basis points.

The secondary market has been a bit busier the primary market but is slowing.

PacifiCorp’s 4.15% first mortgage bonds due Feb. 15, 2050 (A1/A+/) were among the most actively traded investment-grade bonds on Friday and continued to improve on Monday in light trading, a source said.

The bonds were seen closing up at 116.68 from 115.99 over the morning and from where the notes ended Friday at 115.91.

PacifiCorp sold $600 million of the bonds on Feb. 25 at 99.535 to yield 4.177% and a Treasuries plus 115 bps spread.

The electric utility and subsidiary of Berkshire Hathaway Energy Co. is based in Portland, Ore.

Elsewhere in the energy space, Dominion Energy Gas Holdings, LLC’s 3% senior notes due Nov. 15, 2029 were unchanged on the day.

In other secondary trading, Steel Dynamics, Inc.’s 3.45% senior notes due April 15, 2030 priced earlier in December were modestly better in thin secondary volume over the session.

Dominion Energy steady

Dominion Energy Gas Holdings’ 3% senior notes due Nov. 15, 2029 (Baa1/BBB+/BBB+) were unchanged at 114 bps bid in secondary trading on Monday, a market source said.

The company sold $600 million of the 10-year notes on Nov. 18 at a Treasuries plus 123 bps spread.

Dominion Energy Gas Holdings is a Richmond, Va.-based natural gas company and subsidiary of Dominion Energy Inc.

Steel Dynamics edges up

Steel Dynamics’ 3.45% senior notes due April 15, 2030 edged up about a quarter over the day to 100.63 bid, according to a market source.

Steel Dynamics sold $600 million of the notes on Dec. 9 at 99.736 to yield 3.481% and a Treasuries plus 165 bps spread.

Steel Dynamics is a Fort Wayne, Ind.-based steel producer and metals recycler.

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