Morning Commentary: AT&T firms; Morgan Stanley eases; credit spreads widen

By Cristal Cody

Tupelo, Miss., Feb. 8 – High-grade bonds opened mixed in the secondary market on Monday with market conditions volatile, sources said.

AT&T Inc.’s 4.125% notes due 2026 traded 2 basis points better.

Morgan Stanley & Co. Inc.’s 3.875% senior notes due 2026 eased 8 bps.

Credit spreads opened the day weaker. The Markit CDX North American Investment Grade index was quoted 4 bps wider at a spread of 119 bps at the start of the session.

The three-month Libor yield was unchanged early Monday at 62 bps.

AT&T improves

AT&T’s 4.125% notes due 2026 firmed 2 bps to 211 bps offered, a market source said.

The company sold $1.75 billion of the notes (Baa1/BBB+/A-) on Jan. 29 at Treasuries plus 220 bps.

AT&T is a Dallas-based telecommunications company.

Morgan Stanley eases

Morgan Stanley’s 3.875% notes due 2026 traded 8 bps wider at 189 bps offered, a market source said.

Moran Stanley sold $3 billion of the notes (A3/BBB+/A) on Jan. 22 at a spread of 185 bps over Treasuries.

The financial services company is based in New York City.

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