Mondelez, Societe Generale, Guardian Life, EBRD in primary; June deal supply heavy

By Cristal Cody

Tupelo, Miss., June 30 – A few issuers offered bonds in the high-grade primary market on Tuesday following $12.5 billion of issuance on Monday.

Mondelez International, Inc. priced $1 billion of two-year notes (Baa1/BBB/) more than 30 basis points tighter than talk.

Also, Societe Generale SA (A1/A/A) offered two tranches of senior medium-term notes during the session.

The deal includes five-year notes with initial price talk at the Treasuries plus 125 bps to 130 bps area and 15-year notes talked to print at the 310 bps spread area.

Guardian Life Global Funding offered $350 million of seven-year notes (Aa2/AA+/) with initial price talk at the Treasuries plus 105 bps to 110 bps area.

Also, European Bank for Reconstruction and Development (Aaa/AAA/AAA) launched a $1 billion offering of three-year global notes on top of talk at mid-swaps plus 7 bps.

Supply week to date totals more than $13.5 billion.

Volume was strong on Monday, led by Takeda Pharmaceutical Co., Ltd.’s $7 billion four-part offering of senior notes (Baa2/BBB+/) and Sumitomo Mitsui Financial Group Inc.’s $3 billion two-tranche sale of senior notes (A1/A-/).

About $10 billion to $15 billion of issuance was expected by market participants ahead of the Independence Day holiday.

Investment-grade issuance has soared since March and remained heavy in June, Prospect News data shows.

June volume totals $184.89 billion, outpacing the $84.85 billion of notes priced in the same month last year.

Year to date, high-grade volume totals $1.24 trillion, nearly double the $631.4 billion of supply priced in the same period in 2019.

In July, syndicate sources expect about $100 billion of new issuance.

Market tone stayed mostly positive over Tuesday’s session, the last day of the second quarter.

Investment-grade credit spreads recovered over the day and tightened more than 4 bps. The Markit CDX North American Investment Grade 33 index ended the session at a spread of 75.56 bps.

The iShares iBoxx Investment Grade Corporate Bond ETF finished up 0.28% at 134.5.

The PIMCO Investment Grade Corporate Bond index rose 0.18% to 114.28 on the day.

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