Morning Commentary: Raymond James notes firm; Sunoco modestly better; credit spreads improve

By Cristal Cody

Eureka Springs, Ark., July 8 – Bond traders focused over the morning on the Labor Department’s U.S. non-farm payrolls report released on Friday, while new bonds traded mostly tighter in the secondary market.

The non-farm payroll report came in better than forecast by 287,000 jobs versus the 180,000 increase expected. The prior month had a revised gain of 11,000 jobs, according to the Labor Department.

The Labor Department reported a 4.9% unemployment rate for June, higher than 4.7% in May and above the 4.8% expected.

Raymond James Financial, Inc.’s 3.625% senior notes due 2026 that priced on Thursday traded 3 basis points better early Friday.

Sunoco Logistics Partners Operations LP’s 3.9% senior notes due 2026 brought to market in the previous session traded about 1 bp tighter.

The Markit CDX North American Investment Grade index was about 3 bps tighter at the start of the session at a spread of 74 bps.

Secondary bond trading volume in the high-grade market totaled $16.87 billion on Thursday, compared to $18.49 billion on Wednesday and $14.47 billion on Tuesday, according to Trace.

Raymond James firms

Raymond James’ 3.625% senior notes due 2026 firmed to 222 bps offered in secondary trading, according to a market source.

Raymond James sold the notes on Thursday at Treasuries plus 225 bps in a $500 million tranche.

The financial services company is based in St. Petersburg, Fla.

Sunoco edges tighter

Sunoco Logistics Partners’ 3.9% notes due 2026 traded about 1 bp tighter at 254 bps offered, according to a market source.

Sunoco Logistics sold an upsized $550 million of the senior notes (Baa3/BBB/BBB) with a spread of 255 bps over Treasuries on Thursday.

Philadelphia-based Sunoco transports and stores crude oil and natural gas.

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