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High-grade primary wraps slow week following Fed decision; bank, financial paper mixed
By Aleesia Forni and Cristal Cody
Virginia Beach, Sept. 18 – Despite some chatter of a possible rare Friday trade, the high-grade bond primary market was ultimately empty of new issuance on Friday following Thursday’s Federal Reserve rate decision.
The slower week hosted roughly $8.3 billion of supply, well below expectations of around $25 billion to $30 billion.
This figure also follows last week’s frenzied primary, which saw more than $47 billion of new issuance.
Meantime, Lipper reported $737 million of outflows from corporate investment-grade bond funds for the week ended Sept. 16, down from last week’s inflows of $416 million.
Next week should see issuers return to the primary in full force, with sources calling for around $30 billion of supply.
Investment-grade bank and financial paper was mixed in secondary trading on Friday, while credit spreads leaked wider over the session.
JPMorgan Chase & Co.’s 3.9% senior holding company notes due 2025 tightened 1 basis point.
Bank of America Corp.’s 3.875% senior notes due 2025 eased 1 bp in the secondary market.
Barclays plc’s notes were flat to 1 bp weaker.
HSBC Holdings plc’s 4.25% subordinated notes due 2025 headed out unchanged on Friday.
Morgan Stanley’s 4% senior notes due 2025 traded 3 bps wider.
The Markit CDX North American Investment Grade index widened 1 bp to a spread of 78 bps.
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