High-grade deal volume forecast hard to peg; American Express firms; AT&T mostly flat

By Cristal Cody

Eureka Springs, Ark., Oct. 28 – Activity in the investment-grade market stayed fairly quiet on Friday with market expectations for deal volume in the week ahead ranging from as low as $15 billion to as high as $35 billion for the last full week before the U.S. presidential election.

“We’re calling for $15 [billion] to $20 billion,” one syndicate source said. “A lot of issuers were in the market over the past four weeks, and supply was about $30 billion this week. There’s been a lot of market people who just don’t think there may be as many deals next week as there was this week.”

Still, as another market source noted, issuers may try to price ahead of the election.

In the secondary market, new bonds priced over the week traded mostly tighter.

American Express Credit Corp.’s 1.7% senior medium-term notes due 2019 firmed about 5 basis points.

United Technologies Corp.’s senior notes (A3/A-/) priced in five tranches on Thursday were mixed.

Danone SA’s $5.5 billion of notes (Baa1/BBB+/) priced in four tranches on Wednesday traded flat to about 3 bps better than issuance on Friday.

AT&T Inc.’s 4.125% notes due 2026 were mostly stable on Friday, while Time Warner Inc.’s 2.95% notes due 2026 headed out modestly weaker on the day. The companies’ bonds remained wider from the previous week on AT&T’s plans to acquire Time Warner in an $85.4 billion cash-and-stock deal.

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