Toyota Motor Credit, Phillips 66 price; Phillips 66 firms; Chevron mixed; AT&T, Verizon soften

By Cristal Cody

Tupelo, Miss., April 11 – Two reported high-grade issuers tapped the U.S. primary market on Tuesday as pricing action continues to thin ahead of the Good Friday holiday.

Toyota Motor Credit Corp. brought a $2.25 billion three-part offering of medium-term notes in three tranches.

Phillips 66 Partners LP sold $600 million of floating-rate notes in two tranches.

Phillips 66’s notes tightened in secondary trading.

Toyota Motor Credit’s notes were not active in aftermarket trading as the session closed.

“Haven’t seen any secondary trading on the Toyota deal,” a trader said.

Investment-grade primary action is expected to remain light with one full session left in the week. The bond markets will close early on Thursday and will be closed for the full day on Friday.

High-grade corporate bonds were mixed in secondary trading over the day.

“There’s a lot of people out for the holidays, but it seems like a decent amount [of secondary market volume],” the trader said.

Chevron Corp.’s senior notes (Aa2/AA-/) were flat to slightly weaker.

In other secondary trading, AT&T Inc.’s 4.25% notes due March 1, 2027 eased about 2 basis points on Tuesday.

Verizon Communications Inc.’s 4.125% notes due March 16, 2027 traded about 2 bps softer.

The Markit CDX North American Investment Grade index eased 1 bp to a spread of 67 bps.

Toyota Motor Credit prices

Toyota Motor Credit (Aa3/AA-/A) priced $2.25 billion of series B medium-term notes in three tranches on Tuesday, according to a market source and FWP filings with the Securities and Exchange Commission.

The company sold $650 million of three-year floating-rate notes at par to yield Libor plus 26 bps.

Toyota Motor Credit sold $1.1 billion of 1.95% three-year fixed-rate notes at 99.954 to yield 1.966%, or a spread of Treasuries plus 53 bps.

The $500 million tranche of 2.9% seven-year notes priced at 99.95 to yield 2.908% and a spread of 80 bps over Treasuries.

Barclays, HSBC Securities (USA) Inc., Lloyds Securities Inc., BofA Merrill Lynch and Morgan Stanley & Co. LLC were the lead managers.

Toyota Motor Credit is a Torrance, Calif.-based financing arm and subsidiary of Toyota Motor Corp.

Phillips 66 sells floaters

Phillips 66 Partners sold $600 million of floating-rate notes (A3/BBB/) in two parts on Tuesday, according to a market source.

The company priced $300 million of two-year floating-rate notes at par to yield Libor plus 65 bps.

Phillips 66 sold $300 million of three-year floaters at par to yield Libor plus 75 bps.

The bookrunners were BNP Paribas Securities Corp., Deutsche Bank Securities Inc., RBC Capital markets, LLC and TD Securities (USA) LLC.

In the secondary market, the two-year notes were offered at 54 bps.

The three-year notes were seen at 64 bps offered.

The oil, petroleum and natural gas company is based in Houston.

Chevron mixed

Chevron’s 2.498% notes due March 3, 2022 eased 2 bps to 50 bps bid on Tuesday, according to a market source.

Chevron priced $700 million of the five-year notes on Feb. 28 at a Treasuries plus 60 bps spread.

The company’s 2.895% notes due March 3, 2024, priced in a $1 billion tranche on Feb. 28 at a spread of 70 bps over Treasuries, were flat at 66 bps bid.

The petroleum, chemical, mining, power and energy company is based in San Ramon, Calif.

AT&T eases

AT&T’s 4.25% notes due March 1, 2027 traded about 2 bps softer on Tuesday at 169 bps bid, according to a market source.

The company priced $2 billion of the notes (Baa1/BBB+/A-) on Jan. 31 at a spread of Treasuries plus 180 bps.

AT&T is a Dallas-based telecommunications company.

Verizon softens

Verizon Communications’ 4.125% notes due March 16, 2027 eased 2 bps to 155 bps bid, a market source said.

Verizon sold $3.25 billion of the notes (Baa1/BBB+/A-) on March 13 at a spread of Treasuries plus 160 bps.

The telecommunications company is based in New York City.

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