Morning Commentary: Crown Castle, GATX eye market; Kommunalbanken, Ontario on deck

By Cristal Cody

Tupelo, Miss., Jan. 29 – Several high-grade bond issuers are expected to tap the primary market during Tuesday’s session.

Crown Castle International Corp., a Houston-based provider of shared wireless infrastructure to wireless carriers, is marketing 10- and 30-year senior notes (Baa3/BBB-/BBB-).

Chicago transportation leasing company GATX Corp. (Baa2/BBB) announced plans for a 10-year senior note deal a day after holding fixed income investor calls, a source said.

The company held investor calls on Monday for the offering via bookrunners BofA Merrill Lynch, Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC.

Oslo-based government-funded municipalities lender Kommunalbanken AS (Aaa/AAA) is marketing a benchmark-sized Rule 144A and Regulation S offering of five-year dollar-denominated notes, a source said.

The notes due Feb. 5, 2024 were initially talked to price on Tuesday in the mid-swaps plus 17 basis points area.

Also, the Province of Ontario intends to tap its existing Canadian dollar-denominated 2.65% bonds due Feb. 5, 2025 (Aa2/A+//DBRS: AA) in an offering registered with the Securities and Exchange Commission. Ontario sold C$1 billion of the bonds on Jan. 25, 2018 at 99.759 to yield 2.688%, or a spread of 53.3 bps over the Government of Canada benchmark.

Elsewhere on Tuesday, the Federal Reserve kicked off a two-day monetary policy meeting. Under a new policy that took effect in January, press conferences will be held after each central bank meeting. No rate changes are expected, according to market sources.

Volume was heavy on Monday with more than $12 billion of investment-grade bonds priced following the end of the U.S. federal government shutdown on Friday, sources report.

Only about $15 billion to $20 billion of new issuance was forecast for the week with many companies still in earnings blackout reporting periods, sources said.

In the secondary market, $21.02 billion of high-grade bonds traded on Monday, according to Trace data. Of the 6,3866 investment-grade issues traded, 3,314 advanced, 2,813 declined and 47 were unchanged on the day.

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