Morning Commentary: Time Warner paper widens; Morgan Stanley mostly flat; CDX soft

By Cristal Cody

Tupelo, Miss., Aug. 7 – High-grade bonds traded mostly flat to softer early Friday after widening in Thursday’s session as traders focused on the Labor Department’s July jobs report.

The Labor Department announced that total non-farm payroll employment increased by 215,000 jobs in July, compared to the 225,000 forecasted.

The unemployment rate was unchanged as expected at 5.3%.

In the secondary market, Time Warner Inc.’s 3.6% notes due 2025 traded 8 basis points weaker.

Morgan Stanley’s 4% senior notes due 2025 were unchanged to 1 bp softer.

The Markit CDX North American Investment Grade index was 1 bp weaker over the morning at a spread of 75 bps.

Time Warner weak

Time Warner’s 3.6% notes due 2025 were seen 8 bps wider at 186 bps offered, a source said early Friday.

The company sold $1.5 billion of the notes (Baa2/BBB) on May 28 at Treasuries plus 150 bps.

Time Warner is a media company based in New York.

Morgan Stanley mostly flat

Morgan Stanley’s 4% notes due 2025 traded flat to 1 bp weaker at 155 bps offered, a market source said.

Morgan Stanley sold $3 billion of the notes (A3/A-/A) on July 20 at Treasuries plus 165 bps.

The financial services company is based in New York City.

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