Morning Commentary: JPMorgan kicks off expected financial issuance; Kroger, AerCap prep deals

By Cristal Cody

Tupelo, Miss., July 17 – JPMorgan Chase & Co. is starting the week with an offering of fixed-to-floating rate notes.

Bank and financial paper issuance is expected in the high-grade primary market in July following second-quarter earnings reports, according to market sources.

JPMorgan, Citigroup Inc. and Wells Fargo & Co. released earnings reports on Friday. Bank of America Corp., Goldman Sachs Group Inc. and Morgan Stanley are set to release earnings this week.

Market sources forecast about $25 billion to $30 billion of high-grade bond supply for the week.

Also in the deal pipeline, Kroger Co. is marketing senior notes due 2022, 2027 and 2048. Kroger’s notes (Baa1/BBB/BBB) have been mixed since Amazon.com, Inc. announced in June it intends to acquire Whole Foods Market Inc.

In the secondary market early Monday, Kroger’s 4.45% notes due Feb. 1, 2047 softened to 96.46 from 96.65 on Friday, a market source said.

The Cincinnati-based grocery retailer sold $1 billion of the bonds on Jan. 17, 2017 at 99.87 to yield 4.46% and a spread of 150 basis points over Treasuries.

In other expected pricing action, AerCap Ireland Capital DAC and AerCap Global Aviation Trust intend to sell senior notes, while Government Properties Income Trust also is offering senior notes.

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