Morning Commentary: Investment-grade primary supply quiet; market tone softens early

By Cristal Cody

Tupelo, Miss., Oct. 30 – Investment-grade primary action slowed on Friday with no reported issuers offering bonds.

Volume this week beat market forecasts of about $15 billion of expected issuance.

High-grade supply totals more than $18 billion week to date following nearly $8 billion of bonds priced on Thursday.

Boeing Co. leads the week’s supply with its $4.9 billion of senior notes (Baa2/BBB-/BBB-) that priced in four tranches on Thursday.

Market tone was soft at the open on Friday with stock indices down across the board after modest gains on Thursday following Wednesday’s stock sell-off.

The Dow Jones industrial average fell 1.62%, the S&P 500 lost 1.85% and the Nasdaq declined 2.7% in early trading.

The iShares iBoxx Investment Grade Corporate Bond ETF was down 0.28% to $134.05.

The Pimco Investment Grade Corporate Bond index slipped 0.03% to $114.44 over the morning.

Market focus this week continues to shift to third-quarter earnings reports with more than 100 companies slated to post results on Friday.

High-grade companies scheduled to release quarterly earnings reports over the day include Phillips 66, AbbVie Inc., Altria Group Inc., Exxon Mobil Corp., Colgate-Palmolive Co., Weyerhaeuser Co. and Chevron Corp.

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