Primary slows; ConEd prices; Manitoba prints $500 million; Microsoft, Anheuser-Busch widen

By Cristal Cody

Eureka Springs, Ark., June 14 – Investment-grade primary action on Tuesday included only two deals, a new corporate offering and a provincial bond sale, ahead of the completion of the Federal Reserve’s meeting on Wednesday, according to market sources.

Consolidated Edison Co. of New York, Inc. tapped the primary market with a $550 million sale of 30-year debentures at a spread of 142 basis points over Treasuries.

Manitoba priced $500 million of 10-year debentures at 62.25 bps plus Treasuries.

The Canadian primary market was quiet over the session, but there is “potential for a deal here later in the week,” a syndicate source said. “The market is not terrible, it’s just not as robust as we have seen. There’s more market volatility, perhaps due to Brexit, that has people on the sidelines.”

The Markit CDX North American Investment Grade index ended the day more than 2 bps weaker at a spread of 84 bps.

In the secondary market, bonds traded mostly softer.

Microsoft Corp.’s bonds (Aaa/AAA/AA+) were active over the session and headed out weaker.

Anheuser-Busch InBev Finance Inc.’s 3.65% notes due 2026 widened about 7 bps from Monday.

Aetna Inc.’s 4.375% senior notes due 2046 traded 5 bps wider than where the bonds priced earlier in the month.

ConEd prices $550 million

Consolidated Edison Co. of New York sold $550 million of series 2016A debentures on Tuesday at 99.859 to yield 3.858%, according to an FWP filing with the Securities and Exchange Commission.

The debentures due June 15, 2046 (A2/A-/A-) priced with a spread of 142 bps over Treasuries.

BNY Mellon Capital Markets LLC, Morgan Stanley & Co. LLC, Scotia Capital (USA) Inc. and UBS Securities LLC were the bookrunners.

Proceeds will be used for general corporate purposes, including repayment of short-term debt.

Consolidated Edison of New York is an electric and gas utility and a subsidiary of Consolidated Edison, Inc., a New York-based holding company.

Microsoft weakens

Microsoft’s 3.125% senior notes due 2025 traded about 13 bps wider over the day to head out at 76 bps bid, according to a market source.

The company sold $3 billion of the notes on Oct. 29, 2015 at Treasuries plus 95 bps.

Microsoft’s 4.45% bonds due 2045 eased 4 bps to 138 bps bid in late-afternoon secondary trading.

The company sold $3 billion of the bonds in the Oct. 29, 2015 offering at Treasuries plus 150 bps.

Microsoft is a computer software company based in Redmond, Wash.

Anheuser-Busch softens

Anheuser-Busch InBev’s 3.65% notes due 2026 widened to 143 bps bid from where the bonds traded late Monday at 136 bps bid, a market source said.

The notes were seen earlier in the day 3 bps weaker at 133 bps offered.

Anheuser-Busch InBev sold $11 billion of the bonds (A3/A-/BBB+) on Jan. 13 at Treasuries plus 160 bps.

The brewery is based in Leuven, Belgium.

Aetna eases

Aetna’s 4.375% notes due 2046 traded 4 bps weaker early in the day at 185 bps offered, according to a market source.

Aetna sold $2.4 billion of the bonds (Baa2/A/A-) on June 2 at 180 bps over Treasuries.

The diversified health-care benefits company is based in Hartford, Conn.

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