Morning Commentary: Investment-grade bonds remain tight; Apple better; Verizon softens

By Cristal Cody

Tupelo, Miss., June 9 – Investment-grade bonds remained firm early Monday after the Markit CDX North American Investment Grade series 22 index tightened 3 basis points to a spread of 57 bps on Friday, a source said.

More than $30 billion of bonds priced in the previous week. Primary activity on Monday is expected to include deals from issuers such as Arizona Public Service Co., Wintrust Financial Corp. and Home Depot, Inc.

In the secondary market, Apple Inc.’s notes (Aa1/AA+/), which priced in April, traded flat to better early Monday, according to market sources.

Verizon Communications Inc.’s 5.15% notes due 2023 were softer in the morning session, sources said.

Apple paper stronger

Apple’s 3.45% notes due 2024 (Aa1/AA+/) traded unchanged at 75 bps offered early Monday, according to a market source.

The notes climbed to 101.64 in early trading from 100.89 on Friday, according to a source.

Apple sold $2.5 billion of the 10-year notes at a spread of Treasuries plus 77 bps, or 99.916 to yield 3.46%, on April 29.

The computer and mobile communications device company is based in Cupertino, Calif.

Verizon notes ease

Verizon’s 5.15% notes due 2023 (Baa1/BBB+/A-) eased 3 bps to 110 bps offered, a source said.

The notes dropped in early trading to 110.71 from 111.87 on Friday, according to a market source.

Verizon sold $11 billion of the 5.15% notes due 2023 with a spread of Treasuries plus 225 bps, or 99.676 to yield 5.192%, on Sept. 11, 2013.

The telecommunications company is based in New York City.

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