Primary quiets amidst volatile market; GE Capital eases; AT&T, Verizon short-dated notes weak

By Aleesia Forni and Cristal Cody

Virginia Beach, Jan. 14 – Macquarie Bank Ltd. sold a $750 million offering of five-year bonds on Wednesday, with volatile market conditions keeping most issuers on the sidelines.

The notes sold on top of talk, which was unmoved from the initial guidance stage.

“Saw a weaker tone to the market overall today,” one market source said, adding that there was “nothing happening” in the investment-grade space.

In other primary news, Freddie Mac announced price talk for a planned benchmark issue of Reference Notes due Jan. 27, 2017 in the 11.5 basis point area over Treasuries, according to a market source.

The deal is slated to price on Friday, with Barclays, J.P. Morgan Securities LLC and Nomura managing the sale.

So far this week, roughly $15.25 billion of new issuance has priced, slightly more than half of what was expected to be a $30 billion week.

Bonds were mixed in secondary trading, with issues mostly flat to wider in afternoon trading, according to market sources.

The Markit CDX North American Investment Grade series 23 index was unchanged at a spread of 72 bps.

General Electric Capital Corp.’s existing 3.45% notes due 2024 widened about 4 bps on the day, a source said.

Bonds in the telecommunications sector softened, more so on the short end of the curve, according to a market source.

AT&T Inc.’s 3.9% notes due 2024 were quoted nearly 10 bps wider, while the tranche of 4.8% bonds due 2044 eased 3 bps.

Verizon Communications Inc.’s 4.15% senior notes due 2024 traded more than 5 bps weaker. Verizon’s longer-dated bonds (Baa1/BBB+/A-) headed out flat.

Macquarie Bank offering

Macquarie Bank priced $750 million of 2.4% five-year notes (A2/A/) at Treasuries plus 115 bps, according to a market source.

The notes sold in line with talk.

BofA Merrill Lynch, Citigroup Global Markets Inc., Macquarie Bank and Wells Fargo Securities LLC were the bookrunners.

The banking unit of Macquarie Group Ltd. is based in Sydney, Australia.

GE Capital eases

General Electric Capital’s existing 3.45% notes due 2024 (A1/AA+/) eased 4 bps to 94 bps bid, a market source said late afternoon.

GE Capital sold $1 billion of the notes on May 12, 2014 at a spread of Treasuries plus 85 bps.

The financial products and services subsidiary of General Electric Co. is based in Norwalk, Conn.

AT&T weak

AT&T’s 3.9% notes due 2024 (A3/A-/A) widened 9 bps to 148 bps offered, according to a source on Wednesday.

AT&T sold $1 billion of the notes on March 5, 2014 at 125 bps plus Treasuries.

The company’s 4.8% bonds due 2044 eased 3 bps to 205 bps bid, the source said.

The bonds priced in a $2 billion offering on June 3 at a spread of Treasuries plus 140 bps.

AT&T is a Dallas-based telecommunications company.

Verizon soft

In other trading in the telecom sector, Verizon’s 4.15% notes due 2024 eased 6 bps to 165 bps bid, a market source said.

The notes priced in a $1.25 billion offering on March 10, 2014 at Treasuries plus 140 bps.

Verizon’s tranche of 5.05% notes due 2034 were unchanged at 185 bps, the source said.

Verizon sold $1.25 billion of the notes at Treasuries plus 135 bps in the March deal.

The telecommunications company is based in New York City.

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