Investment-grade primary market quiet; market activity slows; Time Warner 2.95% notes firm

By Cristal Cody

Eureka Springs, Ark., Dec. 19 – No reported issuers were in the high-grade primary market on Monday as trading desks thin ahead of the Christmas holiday and with market attention focused on the Electoral College voters’ approval of Donald Trump as the next U.S. president.

Little if any deal volume is expected over the week.

The bond markets will close early on Friday and will be closed on Dec. 26.

The Markit CDX North American Investment Grade index tightened about 1 basis point over the day to close at a spread of 68 bps.

Bonds were mixed in the secondary market during the session.

AT&T Inc.’s 4.125% notes due 2026 were unchanged from Friday.

Time Warner Inc.’s 2.95% notes due 2026 tightened 2 bps on Monday.

AT&T announced plans in October to acquire Time Warner in an $85.4 billion cash-and-stock deal.

Duke Energy Corp.’s 2.65% senior notes due 2026 traded flat on the day.

Earlier in the session, UnitedHealth Group Inc.’s 3.45% notes due 2027 were quoted wrapped around issuance in secondary trading.

AT&T unchanged

AT&T’s 4.125% notes due 2026 were unchanged at 157 bps bid, according to a market source on Monday afternoon.

AT&T (Baa1/BBB+/A-) priced a $900 million add-on to the bonds on May 3 at Treasuries plus 150 bps. The notes originally were sold on Jan. 29, 2016 in a $1.5 billion offering at 195 bps over Treasuries.

The telecommunications company is based in Dallas.

Time Warner firms

Time Warner’s existing 2.95% notes due 2026 firmed 2 bps on Monday to head out at 141 bps bid, a market source said.

Time Warner (Baa2/BBB/BBB+) sold $800 million of the notes on May 5, 2016 at a spread of 135 bps over Treasuries.

The media and entertainment company is based in New York.

Duke Energy stable

Duke Energy’s 2.65% notes due 2026 were flat from Friday at 104 bps bid in secondary trading, a market source said.

The company sold $1.5 billion of the 10-year notes (Baa1/BBB+/BBB+) on Aug. 9 at a spread of 115 bps plus Treasuries.

The diversified energy company is based in Charlotte, N.C.

UnitedHealth steady

UnitedHealth Group’s 3.45% notes due 2027 traded wrapped around issuance at 85 bps bid, according to a market source early Monday.

The company sold $750 million of 3.45% 10-year notes (A3/A+/A-) on Thursday at a spread of 85 bps over Treasuries.

The diversified health company is based in Minnetonka, Minn.

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