High-grade issuers quiet ahead of holiday; Walmart, Charter flat; Bayer, CVS Health soften

By Cristal Cody

Tupelo, Miss., July 3 – The high-grade bond market closed early on Tuesday with no deal activity reported.

The markets shut at 2 p.m. ET and will reopen on Thursday following the U.S. Independence Day holiday.

Syndicate sources expect little to no activity over the week with supply forecasts of zero to up to $5 billion.

Volume is expected to stay light until after companies exit earnings blackout periods in mid-July, while bond offerings related to funding for mergers and acquisitions should stay light until September, sources report.

Bonds priced this year to fund takeover deals were mixed in secondary trading over the day.

Walmart Inc.’s notes priced as part of a $16 billion transaction in June were unchanged.

Bayer AG’s notes priced in June to help fund its $63 billion acquisition of Monsanto Co. softened about 4 basis points to 5 bps.

CVS Health Corp.’s notes (Baa1/BBB+) sold in March to fund its $47.9 billion acquisition of Aetna Inc. eased about 5 bps on Tuesday.

In other new issue trading, Charter Communications, Inc.’s senior secured notes brought to the primary market last week were flat.

The Markit CDX North American Investment Grade 30 index was quoted about 1 bp tighter at a spread of 67 bps.

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