Midday Commentary: Investment-grade bonds flat in early session; AT&T widens

By Cristal Cody

Tupelo, Miss., Sept. 26 - Investment-grade bonds traded flat early Thursday following a heavy day of new issuance, market sources said.

"Credit spreads have been able to shrug off a five-day losing streak for equities and are essentially unchanged from Friday's closing level," RBC Capital Markets, LLC analysts said in a note.

The Markit CDX North American Investment Grade series 21 index eased 1 basis point to close Wednesday at a spread of 80 bps.

"Yesterday was an extremely active day in the new issue market, and this week's push has made September the largest issuance month ever with a total of over $165 billion of U.S. investment-grade deals completed - with Verizon accounting for 30% of total supply," the note said.

New York City-based Verizon Communication Inc.'s record $49 billion bond offering sold on Sept. 11 remains stronger in secondary trading, according to market sources.

Other telecom names have widened since Verizon priced, sources said.

AT&T Inc.'s 2.625% notes due 2022 (A3/A-/A) have eased about 5 bps in secondary trading in the last two weeks.

The notes traded wider at 150 bps bid on Thursday from 145 bps bid, 140 bps offered the day before Verizon priced, sources said.

The Dallas-based telecommunications company sold $1.5 billion of the 2.625% notes due 2022 in December at a spread of 105 bps.

© 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.