Morning Commentary: Bemis, Black Hills, Swedish Export Credit on deck; tone improves

By Cristal Cody

Tupelo, Miss., June 12 – Several issuers are offering bonds in the high-grade primary market on Friday after nearly a dozen issuers stood down as market tone weakened in the previous two sessions, sources report.

Amcor plc subsidiary Bemis Co., Inc. is offering guaranteed fixed-rate senior notes (Baa2/BBB) on Friday following Amcor’s global fixed income investor calls that began Wednesday for a dual-currency offering of dollar- and euro-denominated notes.

The dollar-denominated tranche is expected to include a 10-year maturity.

Black Hills Corp. is marketing new fixed-rate senior notes (Baa2/BBB+/BBB+) during the session.

Swedish Export Credit Corp. plans to price a $500 million reopening of its 1.75% global notes due Dec. 12, 2023 (Aa1/AA+) on Friday.

Initial price talk is in the mid-swaps plus 22 basis points area.

A $1 billion offering of taxable social bonds (Aaa/AAA) also is expected from Ford Foundation, which announced on Thursday plans to price the first non-profit foundation offering of social bonds in the U.S. taxable corporate bond market.

Investment-grade issuers have priced more than $25 billion of bonds week to date.

About $30 billion to $40 billion of issuance was expected for the week.

High-grade credit spreads have widened more than 15 bps over the past four sessions.

Stocks plunged on Thursday but were recovering in early trading on Friday. The Dow Jones industrial average dropped 6.9% on Thursday and was up 1.25% over the morning.

Meanwhile, inflows have remained strong over the past week ended Wednesday for high-grade bond funds and ETFs, according to a BofA Securities, Inc. research note released on Friday.

Bond funds and ETF inflows totaled $11.46 billion, the second highest on record, following a record $14.88 billion inflow in the prior week.

ETF investment-grade inflows declined to $6.17 billion from $9.03 billion a week earlier.

Fund inflows fell to $5.29 billion this past week from $5.85 billion in the prior week, according to the note.

Short-term high-grade inflows slipped to $3.54 billion from $5.41 billion.

Excluding short-term, inflows were lower at $7.93 billion from $9.46 billion in the previous week.

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