Morning Commentary: Tyson, CenterPoint Energy, Baltimore Gas market bonds; Tyson mixed

By Cristal Cody

Tupelo, Miss., Aug. 21 – Issuance in the investment-grade bond market is expected to be steady over Monday’s session with several issuers lining up to price bonds.

Tyson Foods, Inc., which priced $2.75 billion of senior notes (Baa2/BBB/BBB) in four tranches on May 23, intends to return to the primary market to price two tranches of senior notes.

CenterPoint Energy Resources Corp. is offering $300 million of 30-year senior notes.

Also, Baltimore Gas and Electric Co. is marketing 30-year notes.

High-grade deal action likely will be thin for the rest of August with about $5 billion to $10 billion of supply forecast for the week, according to a market source.

In the secondary market, Tyson Foods’ notes that priced in May to fund its acquisition of AdvancePierre Foods Holdings, Inc. traded mostly better, a source said.

Tyson Foods’ 3.55% notes due June 2, 2027 have traded as low as 101.71 and as high as 104.24 since Aug. 14. The notes opened on Monday at 101.81 after going out on Friday at 104.24, the source said.

The $1.35 billion tranche of 10-year notes was priced on May 23 at 99.833 to yield 3.57%, or a spread of Treasuries plus 128 basis points.

Tyson Foods’ 4.55% notes due June 2, 2047 were flat at 106.88 early Monday. The notes traded as low as 105.58 in the past week.

The Springdale, Ark.-based food company sold $750 million of the 30-year notes at 99.416 to yield 4.586%, or a Treasuries plus 163 bps spread.

Looking at the overall secondary market, trading volume totaled $9.78 billion on Friday, according to Trace.

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