Week ends with no new deals; coming week seen busy; Hewlett-Packard, Dell tighter in trading

By Andrea Heisinger and Cristal Cody

New York, Sept. 10 - There were no new deals on Friday, which was in stark contrast to the three previous days when the high-grade primary saw heavy issuance.

There was more than $36 billion priced during the week due to the sheer volume of issues. Both Tuesday and Wednesday had deals in the double digits.

The coming week is not expected to be quite as busy but still has a full calendar, sources said on Friday.

"We should be busy," a syndicate source at a larger desk said. "Monday is to be decided."

Issuance is expected to ramp up more on Tuesday and possibly Wednesday as some people return from the Rosh Hashanah holiday and extended Labor Day break, another source said.

This source predicted "not as much issuance as last week, but steady."

The deals are not expected to be concentrated in any particular sector.

"We should see across sectors and sizes," the syndicate source said, adding "across the curve as well."

This syndicate source predicted $20 billion to $25 billion in deals for the coming week, while the other source said "less than $30 billion."

In the secondary on Friday, new bonds from Hewlett-Packard Co. and Dell Inc. were firmer, according to sources.

"We had all that new issuance this week, that was the focus of the market. Secondary was a little on the light side," a trader said.

Spreads have held steady, though, despite the short holiday week.

"Volume-wise, it looks like things are happening," a trader said.

Overall investment-grade Trace volume slipped about 20% on Friday but still held above $10 billion, closing at nearly $11 billion, a source said.

The Markit CDX Series 14 North American investment-grade index firmed 2 basis points to a spread of 103 bps, according to Markit Group Ltd.

Treasuries ended the week down on a mixture of heavy corporate bond sales, unemployment claims data and the less-than-stellar auction of 30-year bonds Thursday.

"Treasuries are off more," a trader said.

The yield on the 10-year note rose 3 bps to 2.79%. The yield on the 30-year bond added 3 bps to 3.87%.

HP tightens

The notes sold by Hewlett-Packard in the rush of deals on Wednesday firmed in trading, a source said.

Hewlett-Packard sold a $3 billion issue of global senior unsecured notes (A2/A/A) in three tranches a day after competitor Dell priced $1.5 billion.

The tranche of floating-rate notes due 2012 that priced at par to yield Libor plus 12.5 bps firmed in secondary trading.

"Those were offered at 10 today," the source said.

Hewlett-Packard's second tranche of notes due 2013 firmed to a bid of 40 bps in trading on Friday. The notes priced at a spread of Treasuries plus 50 bps.

The third tranche of notes due 2015 priced at a spread of 70 bps over Treasuries and were offered on Friday at 58 bps, the source said.

"They did well."

The computer products and technology company is based in Palo Alto, Calif.

Dell short debt tightens

Not much secondary activity was seen in Dell's new 30-year bonds, but the shorter notes were stronger, according to a source.

On Tuesday, Dell priced $1.5 billion of unsecured notes (A2/A-) in three tranches.

The $500 million tranche of 1.4% notes due 2013 priced at a spread of Treasuries plus 70 bps. The notes were stronger in the secondary and were quoted at 83 bps bid, 78 bps offered.

"They really tightened in," the trader said.

A $700 million tranche of 2.3% notes due 2015 priced at a spread of 90 bps over Treasuries. The notes firmed in Friday morning trading to 83 bps bid, 78 bps offered, a trader said.

The final tranche was $300 million in 5.4% bonds due 2040 priced at Treasuries plus 175 bps. They were seen trading at 180 bps bid, 170 bps offered.

The technology and IT company is based in Round Rock, Texas.

Teck tranches firmer

The new debt Teck Resources Ltd. sold on Wednesday was tighter on flat trading Friday, according to a source.

The company sold $700 million of senior unsecured notes (Baa3/BBB) in two tranches.

A $500 million tranche of 4.5% notes due 2021 priced at Treasuries plus 185 bps. The notes were last seen active in trading on Thursday with a quote of 180 bps bid, 170 bps offered.

The second tranche was a reopening of 6% notes due 2040 to add $200 million. They priced at a spread of Treasuries plus 215 bps and were seen trading early Thursday at 210 bps bid, 200 bps offered.

"Nothing on them at all today," a trader said Friday.

The mining and metals company is based in Vancouver, B.C.

Ontario bonds 1 bp tighter

The Province of Ontario's new notes sold on Wednesday were slightly tighter in the secondary market, a source said.

The province priced $1.25 billion of 1.875% five-year global notes (Aa1/AA-) at 44.7 bps over Treasuries or mid-swaps plus 25 bps, according to an FWP filing with the Securities and Exchange Commission.

"It was offered this morning at 44," the source said.

The issuer is based in Toronto.

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