High-grade primary mostly shut for year; Moody’s eases; Dollar Tree, Dollar General weak

By Cristal Cody

Tupelo, Miss., Dec. 7 – Little primary action is expected for the remainder of the year after the week ended with only one session of high-grade supply.

The Markit CDX North American Investment Grade 31 index ended the day unchanged to modestly softer at a spread of 81 basis points, about 5 bps softer from a week ago.

Investment-grade issuers have stayed out of the primary market since pricing more than $4 billion of bonds on Monday. The financial markets were closed on Wednesday for the funeral of former U.S. president George H.W. Bush.

In the week ahead, zero to about $5 billion of investment-grade deal volume is forecast, according to market sources.

Looking at the secondary market on Friday, Moody's Corp.’s senior notes (BBB+/BBB+) that priced on Monday softened to trade wrapped around issuance.

Dollar Tree Inc.’s senior notes (Baa3/BBB-) remained soft after the company missed third-quarter revenue expectations and lowered its guidance for fiscal 2018 last week.

The retailer’s 4% notes due May 15, 2025 were about 15 bps wider on the week.

Dollar General Corp.’s 4.125% senior notes due May 1, 2028 (Baa2/BBB) headed out about 8 bps weaker on the day.

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