Morning Commentary: Mondelez, Suzano, European Stability offer investment-grade notes

By Cristal Cody

Tupelo, Miss., Sept. 2 – A variety of issuers are marketing new bonds in the high-grade primary market on Wednesday, sources report.

Mondelez International, Inc. plans to price two tranches of fixed-rate notes (Baa1/BBB) in a registered offering.

Suzano Austria GmbH also announced a registered offering of dollar-denominated global notes due in 2031 (BBB-/BBB-) at the start of the day.

European Stability Mechanism (Aa1/AAA/AAA) is marketing a benchmark Rule 144A and Regulation S dollar-denominated offering of notes due 2025.

Meanwhile, Freddie Mac intends to price new three-year Reference Notes with settlement slated for Friday.

In other activity on Wednesday, Johnson Controls International plc will continue a second day of fixed income investor calls for dollar-denominated 10-year green senior notes (Baa2/BBB+/BBB) and a possible euro-denominated issue.

Deal volume totals less than $3 billion week to date.

Supply has been led by Mizuho Financial Group, Inc.’s $2 billion of senior notes (A1/A-) priced in three tranches on Tuesday in the company’s second diversity and inclusion bond offering this year.

Light issuance was expected by market participants in front of the Labor Day holiday with about $5 billion to up to $15 billion of supply forecast.

In the secondary market, trading volume slowed to $18.27 billion on Tuesday after seeing as much as $21.35 billion of high-grade corporate bonds trade on Monday, according to Trace.

At the start of the day, the iShares iBoxx Investment Grade Corporate Bond ETF was up 0.29% at 136.57.

The Pimco Investment Grade Corporate Bond index rose 0.4% to 116.03.

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