U.S. Bancorp, Owl Rock tap high-grade primary; Quebec sells notes; corporate inflows decline

By Cristal Cody

Tupelo, Miss., July 16 – Investment-grade supply included corporate and sovereign, supranational and agency issuance on Thursday.

U.S. Bancorp priced $1.25 billion of 10-year medium-term senior notes (A1/A+/A+) more than 20 basis points tighter than initial talk a day after posting second quarter earnings results.

Owl Rock Capital Corp. sold $500 million of senior notes due Jan. 15, 2026 (Baa3/BBB-/BBB-) in an offering upsized from $300 million.

In SSA primary action, the Province of Quebec (Aa2/AA-/AA-) priced $3.25 billion of five-year global notes better than guidance.

High-grade issuers have priced $5.75 billion of SSA notes and about $9 billion of corporate bonds week to date.

As little as $10 billion to about $20 billion of volume was expected by market participants for the week as supply slows from the record-breaking volume seen over the previous four months.

Coronavirus impact on bank and financial earnings has been in focus this week with the release of second quarter earnings reports from Citigroup Inc., JPMorgan Chase & Co., and Wells Fargo & Co. on Tuesday, Goldman Sachs Group Inc. on Wednesday and Bank of America and Morgan Stanley on Thursday.

Indexes mixed

High-grade corporate fund inflows declined over the past week to $4.53 billion, Refinitive Lipper US Fund Flows reported on Thursday.

Inflows were down for the past week ended Wednesday from $7.18 billion in the previous week and $7.07 billion in the week prior.

Net inflows total $18.69 billion year to date.

The Markit CDX North American Investment Grade 33 index eased nearly 1 bp over the day to a spread of 72.68 bps.

Investment-grade market tone was mixed.

The iShares iBoxx Investment Grade Corporate Bond ETF finished up 0.28% at 136.95.

The PIMCO Investment Grade Corporate Bond Index ended the session down 0.02% on the day at 115.65.

New issues were mixed in the secondary market, a source said.

Hewlett Packard Enterprise Co.’s $1.75 billion of senior notes (Baa2/BBB/BBB+) priced in two tranches om Tuesday were last seen about 1 bp tighter than issuance.

The company’s $1 billion of 1.45% notes due April 1, 2024 priced at a spread of Treasuries plus 130 bps.

Initial guidance was in the Treasuries plus 140 bps area.

A $750 million tranche of 1.75% notes due April 1, 2026 priced at a spread of Treasuries plus 150 bps versus initial talk in the 160 bps spread area.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.