Post-holiday high-grade supply eyed; bank paper mostly firms; January inflows pace strong

By Cristal Cody

Tupelo, Miss., Jan. 17 – The high-grade primary market stayed quiet on Friday following more than $43 billion of corporate and sovereign, supranational and agency supply this week.

Looking to the holiday-shortened week ahead, about $20 billion to $25 billion of investment-grade issuance is anticipated, according to syndicate sources.

The Markit CDX North American Investment Grade 33 index closed Friday modestly tighter at a 43.9 basis points spread.

New issues priced over the week mostly firmed in secondary trading.

Morgan Stanley’s $6 billion two-part offering of global medium-term senior notes priced Thursday traded 10 bps tighter to wrapped around issuance.

Societe Generale SA’s $3 billion of senior medium-term notes priced in two tranches in the previous session firmed about 1 bp on the bid side.

Meanwhile, inflows to U.S. bond funds and ETFs remained heavy for the past week ended Wednesday, according to a BofA Securities, Inc. global research note released Friday.

Overall inflows to the fixed income space was the fifth largest on record at $12.1 billion, but down from the $13.58 billion inflow in the prior week, the third largest on record.

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