High-grade bond markets mostly quiet; bonds firm; HSBC improves; Duke Energy, AT&T tighten

By Cristal Cody

Eureka Springs, Ark., Dec. 23 – The high-grade bond market ended on a quiet note on Friday. Most participants still in the office were focused on leaving early ahead of the holiday weekend.

The bond markets closed at 2 p.m. ET and will be closed on Monday for the Christmas holiday.

The Markit CDX North American Investment Grade index ended mostly flat at a spread of 66 basis points.

HSBC Holdings plc’s 4.375% subordinated notes due 2026 were better in light secondary trading on Friday.

Duke Energy Corp.’s 2.65% senior notes due 2026 came in 2 bps during the short session.

AT&T Inc.’s 4.125% notes due 2026 traded 2 bps tighter on the day.

Time Warner Inc.’s 2.95% notes due 2026 traded about 1 bp better on Friday.

AT&T announced plans in October to acquire Time Warner in an $85.4 billion cash-and-stock deal.

Apple Inc.’s 2.45% notes due 2026 tightened 4 bps on the day.

HSBC improves

HSBC Holdings’ 4.375% subordinated notes due 2026 traded better in thin activity at 99.94 on Friday in the secondary market, compared to where the notes last traded on Thursday at 99.83, according to a market source.

The $1.5 billion offering of notes (A2/BBB+/A+) priced on Nov. 16 at 99.992 to yield 4.376% and a spread of 215 bps over Treasuries.

The banking and financial services is based in London.

Duke Energy firms

Duke Energy’s 2.65% notes due 2026 improved 2 bps in secondary trading to 102 bps bid, according to a market source.

The company sold $1.5 billion of the 10-year notes (Baa1/BBB+/BBB+) on Aug. 9 at a spread of 115 bps plus Treasuries.

The diversified energy company is based in Charlotte, N.C.

AT&T tightens

AT&T’s 4.125% notes due 2026 tightened 2 bps on Friday to head out at 155 bps bid, according to a market source.

AT&T (Baa1/BBB+/A-) priced a $900 million add-on to the bonds on May 3, 2016 at Treasuries plus 150 bps. The notes originally were sold on Jan. 29, 2016 in a $1.5 billion offering at 195 bps over Treasuries.

The telecommunications company is based in Dallas.

Time Warner better

Time Warner’s existing 2.95% notes due 2026 firmed about 1 bp to 140 bps bid, a market source said.

Time Warner (Baa2/BBB/BBB+) sold $800 million of the notes on May 5, 2016 at a spread of 135 bps over Treasuries.

The media and entertainment company is based in New York.

Apple stronger

Apple’s 2.45% notes due 2026 tightened 4 bps in secondary trading to 78 bps, according to a market source.

Apple sold $2.25 billion of the notes (Aa1/AA+/) on July 28, 2016 at a spread of 98 bps plus Treasuries.

The computer and mobile communications device company is based in Cupertino, Calif.

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