Morning Commentary: Bank of Montreal, Juniper, Barclays, WSFS, FS KKR set to price

By Cristal Cody

Tupelo, Miss., Dec. 3 – High-grade supply picked up on Thursday with several financial issuers and others in the day’s deal pipeline.

Bank of Montreal (Aa2/A+/AA-) is marketing two tranches of three-year senior medium-term notes, including fixed- and floating-rate notes.

Juniper Networks, Inc. plans to bring two tranches of fixed-rate senior notes (Baa2/BBB) to the primary market on Thursday following fixed income investor calls in the prior session.

Barclays plc (Ba2//BBB-) intends to price fixed-rate resetting senior callable notes.

WSFS Financial Corp. is offering 10-year fixed-to-floating rate senior notes (Kroll: A-) on Thursday.

FS KKR Capital Corp. (Baa3//BBB-) plans to price registered fixed-rate notes.

In other financial supply, Citigroup Inc. (A3/BBB+/A) is offering $25-par fixed-rate reset preferred stock.

High-grade corporate deal volume totals more than $13 billion week to date following $5.5 billion of supply on Monday, $7.35 billion of issuance on Tuesday and just $600 million of volume on Wednesday. Sovereign, supranational and agency bond supply week to date includes $4.5 billion of notes sold this week.

About $15 billion to $20 billion of corporate supply is expected by market participants for the week.

Market tone was mostly positive early in the day with stock indices all up.

The iShares iBoxx Investment Grade Corporate Bond ETF improved 0.41% to $137.78.

The Pimco Investment Grade Corporate Bond index softened 0.05% to $116.73.

BNY Mellon improves

In the secondary market, new issues were mixed but mostly trading better this week, a source said.

Secondary volume softened to $25.77 billion on Wednesday, compared to $26.22 billion of bonds traded on Tuesday and $28.97 billion on Monday, according to Trace.

Bank of New York Mellon Corp.’s $750 million of 0.35% senior medium-term notes due Dec. 7, 2023 (A1/A/AA-) that priced on Monday with one of the tightest spreads of the year continued to firm in secondary trading to 17 bps bid.

The notes priced at a spread of Treasuries plus 20 bps, on the tight side of guidance in the 22 bps spread area and better than initial talk in the Treasuries plus 40 bps area.

The deal was upsized from $500 million.

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