KfW, Kroger price bonds as tone improves; spreads tighten; Bank of America paper flat

By Aleesia Forni and Cristal Cody

Virginia Beach, Oct. 21 – KfW and Kroger Co. priced new issues on Tuesday during a stronger session for the investment-grade bond market.

The primary saw Kroger bring to market a $500 million offering of seven-year senior notes.

The notes sold at the tight end of price talk, which had firmed around 15 basis points compared to initial guidance.

Meanwhile, KfW sold $3 billion of three-year global notes in line with price talk during the session.

In other primary happenings, FMS Wertmanagement joined the forward calendar on Tuesday, announcing plans to price an offering of notes.

Tuesday’s action brings the week’s total investment-grade supply to $9.7 billion, closing in on what sources had predicted to be around a $15 billion to $20 billion week.

Investment-grade bonds and credit spreads tightened over the day, market sources said.

The Markit CDX North American Investment Grade series 23 index firmed 3 bps to a spread of 66 bps.

Bank and financial paper headed out mostly stable in secondary trading, according to a market source.

Goldman Sachs Group Inc.’s 3.85% notes due 2024 remained wider on the day but ended about 1 bp tighter from where the paper traded over the morning.

Bank of America Corp.’s 4% notes due 2024 were unchanged over the day, a source said.

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