Week ends with quiet primary; supply tops $45 billion; Citigroup improves; Apple notes gain

By Aleesia Forni and Cristal Cody

Virginia Beach, July 24 – The investment-grade bond market wrapped up an action-packed week on a quiet note Friday.

The session was empty of new issuance, keeping the week’s total supply at an impressive $45.7 billion.

This figure tops what was predicted to be around $35 billion to $40 billion of supply and comes on the heels of last week’s $49.5 billion total.

Also this week, Lipper reported $889 million of inflows into corporate investment-grade funds, up from last week’s $267 million of inflows, and pushes the year-to-date total to roughly $30.1 billion of inflows.

Market players are preparing for another busy week ahead, with another $25 billion to $30 billion of supply expected to close out the month of July.

Bonds were mixed in high-grade secondary trading over the day, and credit spreads remained weak over the session.

Citigroup Inc.’s 3.3% senior notes due 2025 traded 3 basis points tighter.

Apple Inc.’s 3.2% notes due 2025 recovered some of Thursday's losses and firmed 4 bps.

AT&T Inc.’s 3.4% notes due 2025 traded about 1 bp weaker on Friday.

Verizon Communications Inc.’s 3.5% notes due 2024 widened 3 bps in the secondary market.

The Markit CDX North American Investment Grade index eased 2 bps to a spread of 72 bps.

Citigroup firms

In secondary trading, Citigroup’s 3.3% senior notes due 2025 firmed 3 bps to 155 bps bid, a source said late afternoon.

Citigroup sold $1.5 billion of the notes (Baa2/A-/A) on April 22 at Treasuries plus 135 bps.

The investment bank is based in New York.

Apple tightens

Apple’s 3.2% notes due 2025 firmed 4 bps to 101 bps bid on Friday, after trading 7 bps wider in the previous session, according to a market source.

The company sold $2 billion of the 10-year notes (Aa1/AA+/) on May 6 at Treasuries plus 100 bps.

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

AT&T eases

AT&T’s 3.4% notes due 2025 traded about 1 bp weaker at 171 bps bid on Friday, a source said.

The company sold $5 billion of the notes (/BBB+/A-) on April 23 at a spread of Treasuries plus 150 bps.

The telecommunications company is based in Dallas.

Verizon weaker

Verizon’s 3.5% notes due 2024 eased 3 bps to 153 bps bid during the session, a market source said.

The company sold $2.5 billion of the notes (Baa1/BBB+/A-) on Oct. 22, 2014 at Treasuries plus 135 bps.

The telecommunications company is based in New York City.

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