Morning Commentary: High-grade primary quiet after busy week; Fidelity, Avangrid eyed

By Cristal Cody

Tupelo, Miss., May 10 – The investment-grade primary market quieted at the start of Friday’s session after issuers priced more than $45 billion of bonds over the week.

In other action, Fidelity National Information Services, Inc. is expected to finish a week-long roadshow on Friday, according to a market source.

Fidelity National Information Services plans to price a multi-currency bond deal to help finance its acquisition of Worldpay Inc.

Also on Friday, New Haven, Conn., electric and gas utility Avangrid, Inc. will hold fixed income investor calls for a possible green bond offering, a source said. Citigroup Global Markets Inc., Credit Agricole Securities (USA) Inc., MUFG and Wells Fargo Securities LLC are the arrangers.

Meanwhile, purchases of high-grade corporate bonds, Treasuries, agencies and mortgage bonds increased to $3.85 billion for the week ended May 8 from $2.12 billion in the prior week, “as stronger inflows to high grade, government bonds and munis more than offset outflows from high yield and leveraged loans,” Yuri Seliger, an analyst with BofA Merrill Lynch, said in a report released on Friday.

Inflows to the high-grade space climbed to $3.1 billion for the week from $2.47 billion the previous week.

“The increase was entirely driven by inflows to short-term high grade,” Seliger said.

Short-term high-grade inflows rose to $920 million from $300 million a week ago.

Flows excluding short-term were steady at $2.17 billion.

Inflows to high-grade funds declined to $1.98 billion from $2.97 billion, while ETF flows turned positive with a $1.12 billion inflow this past week after a $500 million outflow in the prior week, he said.

Elsewhere in the secondary market, trading volume this week has included $18.95 billion of investment-grade bonds traded on Thursday, $18.82 billion on Wednesday, $18.2 billion on Tuesday and $12.45 billion on Monday, according to Trace data.

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