Midday Commentary: Investment-grade spreads softer; Verizon mixed; Morgan Stanley flat

By Cristal Cody

Tupelo, Miss., May 16 - Investment-grade bond spreads remained softer early Friday following more than $38 billion of issuance over the week, according to market sources.

The Markit CDX North American Investment Grade series 22 index eased 2 basis points to a spread of 65 bps on Thursday.

Friday's primary session is expected to stay fairly quiet, sources said.

Verizon Communications Inc.'s bonds (Baa1/BBB+/A-) were mixed in early trading, according to market sources.

Verizon's 5.15% notes due 2023 jumped more than 2 points over the morning, according to a market source.

Morgan Stanley's 3.875% notes due 2024 traded unchanged in midday trading, a source said.

Verizon mixed

Verizon's 4.15% notes due 2024 were quoted flat to 1 bp weaker at 112 bps offered early Friday, according to a market source.

The issue traded as high as 106.25 on Wednesday before falling to 104.26 in the previous session. The notes were quoted early Friday at 104.34, according to a market source.

Verizon sold $1.25 billion of the notes on March 10 at 99.838 to yield 4.17%, or a spread of 140 bps over Treasuries.

The company's 5.15% notes due 2023 climbed to 114.33 in early trading on Friday, a source said. The notes went out on Thursday at 112.08.

Verizon sold $11 billion of the notes at 99.676 to yield 5.192% on Sept. 11, 2013.

The telecommunications company is based in New York City.

Morgan Stanley flat

Morgan Stanley's 3.875% notes due 2024 traded unchanged on the week at 128 bps offered, according to a market source.

Morgan Stanley sold $3 billion of the notes (Baa2/A-/A-) on April 23 at Treasuries plus 130 bps.

The financial services company is based in New York City.

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