Morning Commentary: General Motors active, mixed in secondary; H.J. Heinz firms; spreads soft

By Cristal Cody

Tupelo, Miss., June 26 – General Motors Co.’s bonds (Ba1/BBB-/BBB-) have traded heavily over the past week, according to a market source on Friday.

The company’s bonds were mixed in the secondary market and seen as much as 2 basis points to 4 bps tighter and 6 bps wider.

Goldman Sachs stock analysts downgraded General Motors to “neutral” from “buy” on Wednesday.

In other trading, H.J. Heinz Co.’s 3.95% senior notes due 2025 firmed 2 bps.

The Markit CDX North American Investment Grade series 23 index was 1 bp wider at a spread of 68 bps at the start of the session.

“The spread on all cash bonds widened by 3.6 bps to 134.3 bps, driven by a 4 bps widening in the energy sector,” according to a note on Friday from RBC Capital Markets, LLC.

General Motors mixed

General Motors’ 4% notes due 2025 were seen 6 bps weaker at 160 bps offered in the secondary market, a source said.

The company sold $500 million of the notes at Treasuries plus 175 bps on Nov. 4.

General Motors’ 5.2% bonds due 2045 firmed 4 bps to 214 bps offered, the market source said.

The company priced $1.2 billion of the bonds in the Nov. 4 sale at Treasuries plus 220 bps.

The automaker is based in Detroit.

H.J. Heinz firms

The 3.95% notes due 2025 that H.J. Heinz priced earlier in the week improved 2 bps to 153 bps offered, according to a market source.

The company sold $2 billion of the notes (Baa3/BBB-/) on Tuesday at a spread of Treasuries plus 155 bps as part of a $10 billion offering.

The food processing company is based in Pittsburgh.

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