Canada market activity hits lull amid holidays; Ontario gains; Globalive offering eyed

By Cristal Cody

Prospect News, Dec. 22 - Market activity in the Canadian bond market faded Thursday at participants prepared for Christmas and the ongoing Hanukkah holiday.

Many sources and investors already have left for the week.

"Nothing going on," one high-yield bond source said on Thursday. "Everybody's heading out."

The Canadian bond markets close early on Friday and will be closed on Monday for the holiday.

No new primary activity is expected the rest of the year, except for a potential couple of private placement deals, a source said.

However, a buyside source said Globalive Wireless Management Corp. is expected to come to the high-yield primary market with a $1 billion equivalent offering sometime in the first quarter of 2012. The Rule 144A transaction would have both U.S. dollar- and Canadian dollar-denominated tranches.

Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. and BMO Capital Markets Corp. will be the leads.

The Toronto-based wireless services provider plans to use the proceeds to fund the expansion of its network and for general corporate purposes.

Spreads tighten

On Thursday, corporate bonds traded tighter in light, volatile trading. The Markit CDX Series 17 North American investment-grade index firmed 3 basis points to a spread of 122 bps.

Provincials edged tighter in the secondary market.

The Province of Ontario's 4.4% notes due June 2, 2019 rose to 113.40 on Thursday, up from 113.33 the previous day, according to a market source.

Ontario sold C$1 billion in a reopening of the issue on Oct. 18 at 110.995.

Canadian government bonds fell a second day across the curve. The 10-year note yield rose 3 bps to 1.95%. The 30-year bond yield rose 2 bps to 2.49%.

Statistics Canada released October payroll data on Thursday but the market paid scant attention to it. From September to October, non-farm payroll employment fell 24,500.

Treasuries ended modestly higher. The U.S. Labor Department said weekly jobless claims fell 4,000 to 364,000 the week ended Dec. 17, a three-year low.

Another report from the Commerce Department showed that U.S. gross domestic product rose 1.8% in the third quarter.

Market activity and trading is expected to stay light on Friday.

Paul A. Harris contributed to this story

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