Morning Commentary: Costco, Capital One plan deals; Entergy Arkansas flat; Capital One slips

By Cristal Cody

Tupelo, Miss., May 9 – Several high-grade bond issuers announced plans early Tuesday to tap the primary market.

Costco Wholesale Corp. is marketing a three-tranche offering of senior notes.

Capital One Financial Corp. plans a three-part note offering, including a tap of its 3.75% senior notes due March 9, 2027.

Entergy Arkansas, Inc. also intends to reopen its 3.5% first mortgage bonds due April 1, 2026.

Entergy Arkansas’ bonds were unchanged in the secondary market as the session got underway.

Capital One Financial’s 3.75% notes due 2027 softened in secondary trading early Tuesday.

In the broader high-grade bond market on Monday, $16.42 billion of investment-grade bond issues were traded, Trace reported.

Entergy Arkansas stable

Entergy Arkansas’ 3.5% first mortgage bonds due April 1, 2026 (A3/A-) were unchanged at 102.32 in the secondary market on Tuesday, a source said.

The company sold $325 million of the bonds on Jan. 5, 2016 at 99.671 to yield 3.539%, or a spread of 130 basis points over Treasuries.

Entergy Arkansas is a Little Rock-based energy provider.

Capital One softens

Capital One Financial’s 3.75% notes due March 9, 2027 softened to 99 in secondary trading over the morning, a source said.

The notes (Baa1/BBB/A-) headed out on Monday at 99.21.

Capital One Financial sold $750 million of the notes on March 6 at 99.694 to yield 3.787%, or 130 bps over Treasuries.

The financial services company is based in McLean, Va.

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