Pipeline to stay robust in coming week; December issuance seen pulling back; Shell stronger

By Aleesia Forni and Andrea Heisinger

New York, Nov. 30 - The month of November closed out Friday with no new investment-grade bond deals, but a robust volume tally, market sources said.

According to Prospect News data, there was more than $124 billion of high-grade notes sold, which was $40 billion more than compared to the same month the previous year.

There was just under $35 billion of bonds sold in the past week, and another fully stocked calendar is ahead.

"It's going to be busy, probably on Monday," a source said late in the day.

A syndicate source pegged the week at $20 billion to $25 billion, while another was more conservative with an estimate of $15 billion to $20 billion.

"It looks like it will be skewed more toward industrials," one source said, adding that she was "hearing of a couple [large deals] looming."

The coming week is one of the last ones issuers are looking at to get business done prior to the end of the year.

"I would think people are going to be pulling back with the Jewish holiday and Christmas coming up," a syndicate source said.

December has potential for $40 billion to $45 billion of new supply, the source said.

The Markit CDX Series 18 North American Investment Grade index was unchanged at a spread of 101 basis points on Wednesday.

In the secondary market, Shell International Finance BV's new notes were trading 2 basis points to 3 bps better on Friday.

The $750 million tranche of 0.625% three-year notes was quoted at 30 bps bid, 27 bps offered.

Another trader had quoted the notes at 32 bps bid, 28 bps offered late Thursday after the notes sold at a spread of Treasuries plus 30 bps.

The $1 billion of 2.25% 10-year notes were quoted 6 bps better from levels seen late Thursday.

A trader saw the notes at 72 bps bid, 70 bps offered during Friday's session. The notes priced at 75 bps over Treasuries.

The oil and gas company is based in The Hague, the Netherlands.

Preferred issues seen trading

Prudential Financial Inc.'s $500 million of 5.75% $25-par junior subordinated notes due Dec. 15, 2052 - a deal that priced late Tuesday - was finally trading at par or above, with a trader seeing the notes at $25.05 as of midafternoon.

"That's a big move," the trader said. Paper had been $24.75 bid, $24.85 offered on Thursday.

However, a source said the notes ended flat at par.

And, Comcast Corp.'s $250 million of 5% senior notes due 2061 was trading at $24.60 at midday, following pricing on Thursday.

A market source saw the issue closing around $24.50, but noted that a late-day trade at $28.00 had occurred. He deemed the trade to be a price manipulation going into month-end.

He also noted that the $24.50 price tag was off 15 cents from the day before.

Stephanie N. Rotondo contributed to this review

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.