Morning Commentary: High-grade supply resumes; Bristol-Myers, Vereit, Entergy on tap

By Cristal Cody

Tupelo, Miss., Nov. 9 – The investment-grade primary market roared back to life on Monday with numerous companies marketing bond offerings over the morning.

Bristol-Myers Squibb Co. is offering seven tranches of senior notes (A2/A+/A-), which include one tranche of floating-rate notes and six tranches of fixed-rate notes.

Vereit Operating Partnership LP plans to price two tranches of guaranteed senior notes (Baa3/BBB-/BBB) on Monday.

Republic Services, Inc. is offering two tranches of fixed-rate notes (Baa2/BBB+/BBB).

Entergy Louisiana LLC (Baa1/A-) is marketing new collateral trust mortgage bonds and an add-on to its 2.9% collateral trust mortgage bonds due March 15, 2051.

Westpac Banking Corp. plans to price subordinated notes due 2035 and 2040 (Baa1/BBB-/BBB).

Ameren Illinois Co. is marketing 10-year first mortgage bonds (A1/A) on Monday.

Consolidated Edison Co. of New York, Inc. plans to price new fixed-rate debentures (Baa1/A-/A-).

Also in other supply, Public Storage plans to sell $25-par preferred shares (A3/BBB+).

Last week, high-grade issuance totaled just $2.5 billion from a four-part offering of notes (Baa1/A-/BBB+) from Waste Management, Inc.

About $25 billion to $30 billion of high-grade supply is expected in the primary market this week with issuance anticipated to be front-loaded ahead of Wednesday’s Veterans Day holiday, syndicate sources said.

Market tone was mixed over the morning as the financial markets mostly ignored uncertainty around the U.S. presidential election after Joe Biden was declared the winner on Saturday by media outlets and president Trump filed lawsuits to contest votes in certain states.

The iShares iBoxx Investment Grade Corporate Bond ETF declined 0.57% to $135.41.

The Pimco Investment Grade Corporate Bond index softened 0.6% to $115.14.

Stocks climbed over the morning on Pfizer Inc.’s announcement that a vaccine candidate has been more than 90% effective in preventing Covid-19 infections in a trial study. The Dow Jones industrial average jumped 3.98%, the S&P 500 rose 2.92% and the Nasdaq was up 1.27% in early trading.

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