Midday Commentary: Market rallies following Bernanke's comments; recent issues tighten

By Aleesia Forni

Virginia Beach, Va., July 11 - Activity in the high-grade bond market was revived early during Thursday's session following Federal Reserve chairman Ben Bernanke's comments late Wednesday, a trader said, while recent deals from the Bank of Nova Scotia and Southern Power Co. continued to tighten in trading.

The Markit CDX North American Investment Grade index was 3 basis points tighter at a spread of 79 bps at mid-morning.

The Bank of Nova Scotia's $1 billion of 1.375% three-year bonds, which priced at a spread of Treasuries plus 72 bps on Wednesday, was quoted 3 bps better at 66 bps bid, 62 bps offered.

The sale also included a $1 billion tranche of three-year floating-rate notes sold at par to yield Libor plus 52 bps.

Scotiabank is a financial services company based in Halifax, N.S.

In other trading, Wednesday's sale from Southern Power was quoted 1 bp better early Thursday at 151 bps bid, 147 bps offered.

The company sold the upsized $300 million of 5.25% 30-year senior notes at a spread of Treasuries plus 160 bps.

Southern Power is an Atlanta-based holding company for utility subsidiaries in the South.

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