Morning Commentary: Regeneron offers two tranches; bond fund, ETF inflows rise

By Cristal Cody

Tupelo, Miss., Aug. 7 – The primary market is expected to remain active on Friday with a two-part offering from Regeneron Pharmaceuticals, Inc.

Regeneron Pharmaceuticals is marketing fixed-rate registered senior notes (Baa3/BBB+) with the proceeds set to repay in full $1.5 billion of loans outstanding.

Investment-grade issuers have kept pricing action strong over the week with about $34 billion of bonds priced in the first four sessions.

About $25 billion to $35 billion of issuance was expected by market participants for the week.

Meanwhile, overall investment-grade bond fund and exchanged-traded fund inflows rose to $10.14 billion for the past week ended Wednesday from $9.03 billion in the prior week, according to a BofA Securities, Inc. research note released Friday.

High-grade “inflows were broad-based” with ETF inflows down to $2.68 billion from $3.61 billion, funds up at $7.46 billion from $5.42 billion, short-term inflows softer at $3.19 billion from $3.28 billion and excluding short-term inflows higher at $6.95 billion from $5.76 billion in the prior week, according to the report.

Elsewhere, the Labor Department announced improvements in the labor market with total nonfarm payroll employment up by 1.8 million in July. The unemployment rate fell to 10.2% from 11.1% in June.

Analysts expected a 1.48 million jobs gain and a 10.6% unemployment rate.

The data was better than forecast “and provides further evidence that the recession will likely be short-lived,” Confluence Investment Management LLC strategists said in a note on Friday.

The Pimco Investment Grade Corporate Bond Index softened 0.08% to 117.62 in early trading.

The iShares iBoxx Investment Grade Corporate Bond ETF declined 0.1% to 139.01.

© 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.