Decent tone, but no new deals; Praxair bond barely moves; upcoming issuance seen sparse

By Andrea Heisinger

New York, Aug. 28 - There were no new offerings priced Friday, as syndicate and trading desks emptied out early ahead of the weekend.

The coming week is expected to have light issuance, made up mostly of those companies needing to price debt ahead of the long Labor Day weekend.

In the secondary, Praxair Inc. and Roper Industries Inc. saw their bonds modestly tighten from recent pricing levels, a trader said.

Spreads were slightly wider as Treasuries rallied by late afternoon.

The 10-year government note was in 1 basis point from the previous day to 3.45%. The five-year note performed about the same, coming in 2 bps to 2.45%.

New deals desert primary

Friday was characterized as a dull day, with not much worth talking about, a market source said late in the afternoon.

"It was painful today," he said, referring to the lack of issuance. "There was just nothing. No one's doing any work today."

The coming week is expected to be nearly as painful as far as lack of deals.

"We're not expecting anything," a syndicate source said. Another source echoed him later, saying: "It's looking slow" for the coming week.

The tone wasn't bad on Friday, the syndicate source said, adding: "It's hard to tell with nothing pricing."

There are no solid sales lined up for the week ahead, and any that do price will likely be opportunistic, the syndicate source said.

"Everyone's already on vacation," he said.

Praxair bond stays stronger

The new 3.25% bond due 2015 from industrial gas maker Praxair remained tighter Friday afternoon after coming to market the previous day.

The bond made slight gains off the bat after pricing, seen at 81 bps bid, 78 bps offered. On Friday it was quoted by a trader at 81 bps offered with no bid.

Roper 10-year tightens

Roper Industries retook previous gains for its 6.25% bond due 2019 that priced Wednesday at 280 bps over Treasuries.

The bonds initially tightened by 15 bps or more, and then slipped slightly the following day. By Friday, a trader quoted them at 265 bps bid, 262 bps offered.

Morgan Stanley tops trading

A 7.3% bond due 2019 from Morgan Stanley was at the top of trading volume early Friday, a trader said. When asked why the financial was trading at high volume, a trader in that sector said he was "not hearing anything [about Morgan Stanley]."

Also doing well was a bond from AOL Time Warner Inc. The media and entertainment company's 6.875% bond due 2012 was behind Morgan Stanley in trading. A Citigroup Inc. long bond was also receiving a lot of investor attention. Bonds from the financial were moving around Thursday after comments from John Paulson about buying Citi shares.

Bank, broker CDS stay tighter

The costs of bank and brokerage credit-default swaps were mostly better for the second day in a row, a trader said late in the day.

Bank names were 3 to 5 bps tighter. They were unchanged to 5 bps tighter on Thursday.

Brokerages were unchanged to 5 bps tighter Friday, which was the same as they had been the previous day.

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