Morning Commentary: Virginia Electric, Harley-Davidson on tap; high-grade inflows fall

By Cristal Cody

Tupelo, Miss., Nov. 26 – A handful of issuers prepared early Monday to tap the high-grade primary market following the long Thanksgiving holiday weekend.

Virginia Electric and Power Co. is offering 30-year senior notes, while Brunswick Corp. is marketing $25-par senior notes due 2049, according to 424B5 filings with the Securities and Exchange Commission.

Harley-Davidson Financial Services Inc. also plans to price three-year senior medium-term notes (BBB+), according to a ratings release from S&P Global Ratings on Monday.

Supply totals likely will improve this week with a backlog of deals – previously pulled from the market due to market volatility over the past two weeks – on tap, according to market sources.

About $10 billion to $20 billion of deal volume is forecast for the week but could be higher depending on market tone, syndicate sources said.

High-grade corporate issuers priced $6 billion of bonds last week, in line with syndicate forecasts of about $5 billion to $10 billion of investment-grade issuance.

The bond markets were closed on Thursday and closed early on Friday due to the holiday.

For the week ended Nov. 21, Lipper US Fund Flows reported inflows of $287 million for corporate investment-grade funds, down from inflows of $755 million in the prior week.

Friday’s session saw $2.17 billion of investment-grade issues traded, according to Trace data.

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