Morning Commentary: Supply ramps up; PartnerRe, Pentair, Realty Income, IBRD in queue

By Cristal Cody

Tupelo, Miss., June 12 – Investment-grade supply is expected in both the corporate and the sovereign, supranational and agency primary markets on Wednesday.

PartnerRe Ltd. announced an offering of 10-year guaranteed senior notes after completing a two-day round of fixed income investor calls on Tuesday.

Pentair Finance Sarl is marketing fixed-rate guaranteed senior notes.

Realty Income Corp. plans to price new 10-year fixed-rate notes.

Boston Properties LP is on deck with new fixed-rate senior notes.

In addition, American Campus Communities Operating Partnership LP is offering fixed-rate guaranteed senior notes.

In SSA primary action, the International Bank for Reconstruction and Development, or World Bank, plans to price a dollar-denominated offering of four-year global notes on Wednesday.

The notes were initially talked to price in the mid-swaps plus 5 basis points area.

Also, Kommunalbanken AS intends to price a dollar-denominated offering of five-year notes during the session.

The notes were initially talked to price in the mid-swaps plus 17 bps area.

Week to date, high-grade corporate deal volume totals more than $21 billion after issuance topped $17 billion on Monday and more than $4 billion on Tuesday.

Corporate deal volume this week has been led by Fiserv, Inc.’s $9 billion four-part offering of senior notes on Monday.

SSA supply totals $3.1 billion week to date following issuance on Tuesday from Inter-American Development Bank and the European Investment Bank.

About $20 billion to $25 billion of issuance was expected by syndicate sources for the week.

New issue concessions widened to 10.9 bps on Tuesday from 6.6 bps on Monday, while break performance declined to 2.3 bps tighter from 3.5 bps tighter on Monday, Yuri Seliger, a credit strategist with BofA Securities, said in a research note released on Wednesday.

Fiserv’s four tranches of notes have tightened about 5 bps to 6 bps from issuance in secondary trading, according to the report.

Secondary market volume ramped up on Tuesday with $22 billion of bonds traded, up from $17.64 billion on Monday, according to Trace data.

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