Morning Commentary: Investment-grade bonds soft; Apple, Amazon.com, Barclays trade wider

By Cristal Cody

Tupelo, Miss., Dec. 15 – Investment-grade bonds remained weaker to start the week as traders focus on the upcoming two-day Federal Reserve policy meeting, according to market sources.

The Markit CDX North American Investment Grade series 23 index closed on Friday more than 3 basis points wider at a spread of 72 bps.

The Federal Reserve’s policy-setting Federal Open Market Committee will meet on Tuesday and Wednesday.

In the secondary market, Apple Inc.’s 3.45% notes due 2024 widened after trading flat early Friday but were up more than a point, according to a market source.

Amazon.com, Inc.’s 4.95% senior notes due 2044 that priced in early December traded 2 bps weaker than issuance, a source said.

In the bank and financial bond sector, Barclays plc’s 2.75% senior notes due 2019 eased 5 bps, a market source said.

Apple widens

Apple’s 3.45% notes due 2024 (Aa1/AA+/) were quoted wider at 94 bps bid, a market source said.

The notes traded unchanged at 81 bps offered on Friday, a source said.

Apple’s notes climbed more than a point over the morning to 105.985 to yield 2.723%, a source said. The notes last traded on Friday at 104.071 to yield 2.95%.

Apple sold $2.5 billion of the notes at a spread of Treasuries plus 77 bps on April 29, 2014. The notes priced at 99.916 to yield 3.46%.

The computer and mobile communications device company is based in Cupertino, Calif.

Amazon.com soft

Amazon.com’s 4.95% notes due 2044 (Baa1/AA-/) eased 3 bps in secondary trading to 207 bps offered, a market source said.

The bonds traded lower at 191.765 to yield 4.837% from 102.085 to yield 4.817%, according to a source.

The company sold $1.5 billion of the bonds at Treasuries plus 205 bps, or 99.236 to yield 5.065%, on Dec. 2.

The online retailer is based in Seattle.

Barclays eases

Barclays’ 2.75% senior notes due 2019 eased 5 bps to 118 bps offered, a market source said.

The notes (A3/A-/A) traded early Monday at 99.994 to yield 2.751%, down from 100.199 to yield 2.706% on Friday, according to a market source.

Barclays sold $2 billion of the notes at 99.648 to yield 2.826% and with a spread of Treasuries plus 120 bps on Nov. 3.

The financial services company is based in London.

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