By Richard A. Bravo
NEW YORK, Sept 19 (Reuters) - Early Friday morning the U.S. high-grade corporate bond market was trading firmer, with spreads around two basis points tighter, continuing its momentum that has pushed bond spreads tighter all week.
A basis point is one hundredth of a percentage point.
"The market is feeling pretty good," said one portfolio manager. "There's been a good week of supply that got digested well, and we're trading better with stocks doing better. It's hard to find a deal that's not doing well."
Corporations sold about $8.5 billion in investment-grade debt this week, driven by low interest rates and robust investor demand for higher-yielding alternatives to debt such as Treasuries.
Ford Motor Credit Co., the financing arm of Ford Motor Co. , continued to see its newly priced bonds trade well in the secondary market. Ford's 5.625 percent issue due Oct. 2008, which priced at 2.60 percentage points over Treasuries on Tuesday, was recently quoted at 2.36 percentage points over Treasuries, according to MarketAxess. Ford's 7.00 percent issue due Oct. 2013, which priced at 2.80 percentage points over Treasuries, was recently quoted at 2.70 percentage points over Treasuries.
In the primary market, Cadbury Schweppes is planning to sell a $1.5 billion two-part debt transaction through joint lead managers Banc of America Securities, Deutsche Bank Securities and J.P. Morgan.
The issue will be split between five- and 10-year maturities, and is expected to price next week.
The debt has been rated 'Baa2' by Moody's Investors Service and 'BBB' by both Standard & Poor's and Fitch Ratings.
In other markets, U.S. Treasury prices were down slightly in very thin volume. The benchmark 10-year note was recently down 3/32 in price to yield 4.176 percent.
To see upcoming and recent corporate bond sales, click on [nNEUBD4].