Morning Commentary: High-grade primary quiet ahead of Fed statement; Morgan Stanley active

By Cristal Cody

Tupelo, Miss., June 14 – Primary activity in the high-grade bond markets stayed quiet over the morning on Wednesday ahead of the Federal Reserve’s monetary policy announcement later in the day.

Market participants widely expect the Federal Reserve to announce a rate increase of 25 basis points.

In addition, news reports of a gunman shooting at Congressional members at a baseball practice dominated market reports over the morning.

No reported investment-grade issuers were in the bond deal pipeline at the start of the session.

The three-month Libor yield was unchanged at 1.24% early Wednesday, according to a market source.

In secondary trading, Morgan Stanley’s 2.75% global medium-term senior notes due May 19, 2022 (A3/BBB+/A) have been active this week.

The company’s notes headed out on Monday at 99.98 and last traded on Tuesday at 101.44, a source said. The notes were seen early Wednesday at 100.47.

The New York-based financial products and services company priced $3.25 billion of the five-year notes on May 16 at 99.791 to yield 2.795% and a spread of 95 bps over Treasuries.

Overall high-grade secondary market volume on Tuesday rose to $18.02 billion from $13.21 billion on Monday, according to Trace.

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