Morning Commentary: Fannie Mae sells $2 billion notes; KfW plans three-year issue

By Cristal Cody

Tupelo, Miss., July 3 – Fannie Mae priced $2 billion of 1.75% Benchmark Notes due July 2, 2024 at 99.621 to yield 1.83%, or a spread of 9 basis points over Treasuries, early Wednesday.

Barclays, CastleOak Securities, LP, Citigroup Global Markets Inc. and Nomura Securities International, Inc. were the lead managers.

Also on Wednesday, KfW is expected to price new three-year global notes.

The notes due Aug. 2, 2022 were initially talked to price at a spread in the mid-swaps plus 7 bps area.

Barclays, Morgan Stanley & Co. LLC and RBC Capital Markets LLC are the lead managers.

In other issuance, Mitsubishi Corp. released final terms on Wednesday of the Tokyo trading company’s $500 million sale of 2.5% five-year notes issued under its euro medium-term note program.

Mitsubishi sold the notes due July 9, 2024 (A2/A) at 99.469 to yield 2.614%. The offering was priced via bookrunners Citigroup Global Markets Ltd. and J.P. Morgan Securities plc and closes July 9.

Otherwise, market activity was light ahead of the early market close.

The U.S. bond markets will close at 2 p.m. ET on Wednesday and remain closed on Thursday for the Independence Day holiday.

Corporate issuers have taken a breather this week ahead of the holiday with no deals priced so far in July.

Market sources said they expected zero up to about $5 billion of corporate issuance this week.

After the Fourth of July holiday, Kadoma-shi, Osaka, Japan, electronics company Panasonic Corp. will start a global roadshow on Friday for a Rule 144A and Regulation S dollar-denominated note offering, a source said.

BofA Securities, Inc., Goldman Sachs & Co. LLC and Morgan Stanley are the arrangers.

Looking ahead to next week, syndicate sources forecast about $15 billion to $20 billion of deal volume.

Meanwhile, the secondary market has been active this week. On Tuesday, $18.11 billion of high-grade bonds were traded, up from $16.33 billion on Monday, according to Trace data.

© 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.