Morning Commentary: High-grade corporate bonds mixed; Adobe mostly unchanged; Verizon firms

By Cristal Cody

Tupelo, Miss., Jan. 22 – High-grade corporate bonds were mixed in early secondary trading on Thursday, according to market sources.

Adobe Systems Inc.’s 3.25% senior notes due 2025 that priced on Wednesday traded flat to 1 basis point softer, a market source said.

Verizon Communications Inc.’s bonds (Baa1/BBB+/A-) tightened after the company reported a fourth-quarter loss before the market opened on Thursday, a source said.

Verizon announced a loss of 54 cents per share in the quarter, compared with a profit of $1.76 per share in the same period a year ago. For the fiscal year, Verizon reported earnings per share of $2.52, down from $4.00 per share in fiscal 2013.

The Markit CDX North American Investment Grade index improved 2 bps to a spread of 71 bps on Thursday.

Adobe notes steady

Adobe Systems’ 3.25% notes due 2025 (Baa1/A-/) traded unchanged to 1 bp wider at 149 bps bid, a market source said.

The notes were quoted going out in secondary trading at 148 bps bid, 144 bps offered on Wednesday.

Adobe Systems sold $1 billion of the 10-year notes on Wednesday at a spread of Treasuries plus 155 bps.

The computer software and services provider for businesses is based in San Jose, Calif.

Verizon bonds tighten

Verizon’s 6.55% bonds due 2043 firmed 4 bps to 217 bps bid, according to a market source.

Verizon sold $15 billion of the bonds on Sept. 11, 2013 at Treasuries plus 265 bps.

The telecommunications company is based in New York City.

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