Midday Commentary: Shell tightens; Williams Partners, Air Lease widen in morning session

By Cristal Cody

Tupelo, Miss., Nov. 13 - Investment-grade bonds weakened in sympathy with equity futures on Wednesday with new issues sold in the previous session mostly wider in the secondary market, according to informed sources.

"Everything's pretty much wider in line with new issues," a trader said.

The Markit CDX North American Investment Grade series 21 index eased 1 basis point to a spread of 73 bps on Tuesday.

In the secondary market, Shell International Finance BV's traded "a little bit stronger now than yesterday," a trader said.

Williams Partners LP's senior notes, which traded wider on Tuesday after pricing, stayed weaker in the morning session, a source said.

In other new issue trading, Air Lease Corp.'s 3.375% senior notes due 2019 (/BBB-/) widened in the secondary market, according to a trader.

Shell better

Shell International Finance's 2% notes due 2018 firmed to 51 bps bid, 48 bps offered in the morning session, according to a trader.

The five-year notes (A1/AA/) traded late Tuesday in the secondary market at 54 bps bid, 51 bps offered.

The company sold $1.25 billion of the notes at Treasuries plus 55 bps as part of a four-tranche offering on Tuesday.

Shell International Finance is the funding arm of the Hague, the Netherlands-based oil and gas company Royal Dutch Shell plc.

Williams eases

Williams Partners' 4.5% senior notes due 2023 (/BBB/BBB-) traded early Wednesday at 183 bps bid, 182 bps offered, a trader said.

The notes were quoted in the previous session at 184 bps bid, 181 bps offered.

Williams Partners sold $600 million of the 10-year notes at Treasuries plus 180 bps on Tuesday.

The energy infrastructure company is based in Tulsa, Okla.

Air Lease weaker

Air Lease's 3.375% senior notes due 2019 (/BBB-/) traded weaker early Wednesday at 198 bps bid, 197 bps offered, or 99.9 bid, par offered, a trader said on Wednesday.

"They're a little bit wider this morning," the trader said.

The notes were seen late on Tuesday stronger at 102.5.

Air Lease sold $700 million of the notes at 99.858 to yield 3.406%, or a spread of Treasuries plus 195 bps, in Tuesday's market.

The aircraft leasing company is based in Los Angeles.

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