Morning Commentary: High-grade primary action set; Microsoft tightens; Libor yield up

By Cristal Cody

Eureka Springs, Ark., Oct. 11 – Investment-grade bond issuers including Phillips 66 Partners, LP and Sumitomo Mitsui Financial Group, Inc. plan to tap the primary market on Tuesday following the long holiday weekend.

In the secondary market, Microsoft Corp.’s 2.4% senior notes due 2026 were active and traded about 2 basis points tighter and more than 20 bps better than where the bonds priced in August.

The Markit CDX North American Investment Grade index opened the session unchanged at a spread of 74 bps.

The three-month Libor yield rose 1 bp to 88 bps on Tuesday.

High-grade secondary trading volume was light on Friday ahead of the Columbus Day holiday with $36 million of issues traded, according to Trace.

Microsoft improves

Microsoft’s 2.4% notes due 2026 firmed about 2 bps to 67 bps offered in secondary trading, according to a market source.

The company sold $4 billion of the 10-year notes (Aaa/AAA) on Aug. 1 at a spread of 90 bps over Treasuries.

The computer software company is based in Redmond, Wash.

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