Morning Commentary: Long bonds active in secondary; Williams, Microsoft, Merck mostly flat

By Cristal Cody

Tupelo, Miss., March 2 – New long bonds priced in February picked up activity in the secondary market but traded mostly flat to 1 basis point tighter, according to market sources.

Williams Cos. Inc.’s 5.1% senior notes due 2045 were flat from where the bonds priced on Thursday.

Merck & Co., Inc.’s 3.7% notes due 2045 brought in early February traded about 1 bp better.

Microsoft Corp.’s 4% bonds due 2055 were unchanged in secondary trading.

The Markit CDX North American Investment Grade index closed flat on Friday at a spread of 61 bps.

Merck steady

Merck’s 3.7% notes due 2045 firmed about 1 bp to 112 bps offered, according to a market source.

Merck sold $2 billion of the bonds (A2/AA/) on Feb. 5 at a spread of Treasuries plus 130 bps.

The health care company is based in Whitehouse Station, N.J.

Williams unchanged

Williams’ 5.1% notes due 2045 traded flat from issuance at 250 bps offered, a market source said.

The company sold $750 million of the bonds (Baa2/BBB/BBB) on Thursday at Treasuries plus 250 bps.

The Tulsa, Okla.-based company produces, processes and transports natural gas.

Microsoft flat

Microsoft’s 4% bonds due 2055 were unchanged at 142 bps offered, according to a market source.

Microsoft sold $2.25 billion of the bonds (Aaa/AAA/) on Feb. 9 at 153 bps over Treasuries.

The computer software company is based in Redmond, Wash.

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