Week closes with no primary activity; new issues widen; Morgan Stanley weak

By Cristal Cody and Aleesia Forni

Virginia Beach, Jan. 24 - The primary was empty of new issuance on Friday amidst a weaker overall tone for the high-grade market.

There had been whispers of activity emerging during the session, though no deals ultimately came to market.

Details of PNC Bank NA's recent $1.75 billion sale of notes emerged on Friday.

The Pittsburgh-based bank priced $1 billion of 1.125% three-year notes at Treasuries plus 42 basis points and $750 million of 2.2% five-year notes at 65 bps over Treasuries on Thursday.

Both tranches sold at the tight end of talk.

"Quiet day," one source said of Friday's session. "Expecting [issuance] to pick back up on Monday."

Looking to the week ahead, sources are expecting around $20 billion of supply to come to market.

Investment-grade bond spreads moved out on Friday, according to market sources.

The Markit CDX North American Investment Grade series 21 index was "almost 5 [bps] wider," a trader said late afternoon.

The CDX index widened over the day to a spread of 73 bps from 68 bps on Thursday.

New issues traded mostly weaker during the session, sources said.

In the secondary market, Morgan Stanley & Co. Inc.'s 2.5% senior notes due 2019 widened 8 bps from issuance, according to a trader.

Textron Inc.'s 3.65% notes due 2021 eased 3 bps from where the notes priced on Thursday, a trader said.

Morgan Stanley widens

Morgan Stanley's 2.5% notes due 2019 (Baa2/A-/A-) widened to 103 bps bid, 99 bps offered in the secondary market on Friday, a trader said.

Morgan Stanley sold $2 billion of the notes at a spread of Treasuries plus 95 bps on Tuesday as part of a $2.75 billion two-part offering of notes.

The financial services company is based in New York City.

Textron eases

Textron's 3.65% notes due 2021 (Baa3/BBB-/BBB-) eased in secondary trading to 148 bps bid, 138 bps offered on Friday, a trader said.

The notes initially traded tighter in the aftermarket on Thursday at 141 bps bid, 139 bps offered.

Textron sold $250 million of the 3.65% notes due 2021 with a spread of Treasuries plus 145 bps on Thursday in a $600 million two-part offering of debt.

The Providence, R.I.-based company operates aircraft, defense, industrial and finance businesses.

© 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.