Some $1.75 billion of new debt rolled in yesterday two days ahead of the September employment figures.
Some economists believe a decline in employment could prompt the Federal Reserve to ease monetary policy, which would lower issuers' borrowing costs.
But it could well have been an unwillingness to bet on the unknown that brought yesterday's issuers to market.
"You almost think there are some people thinking 'let's not bet on the unemployment [figure],'" a source from one consulting firm said.
A portfolio manager agreed, "It's kind of like a bird in the hand is worth a dozen in the bush," she said.
Even if the Fed does ease, it is possible the market may think it hasn't gone far enough and could react negatively, she said.
"If I wait and I'm wrong, we can see how really negatively the market reacts when it doesn't get the gratification it wants," she said.
Asked about pricing on yesterday's deals, she replied, "I actually think they were a little tight."
While one trader agreed that some of the issues were priced tightly, he noted good interest in deals by Amoco Canada Petro. Co., Anheuser-Busch Cos., and Coca-Cola Co. Coca-Cola's offering was increased to $ 150 million from $100 million.
The new-issue market is also awaiting Tenneco Inc.'s $500 million 10-year offering expected imminently through Morgan. Stanley & Co., syndicate and other sources said. Price talk on that deal is about 160 basis over comparable Treasuries.
In secondary high-grade trading yesterday, "there was absolutely no excitement at all," one trader said. "I think the holidays are still with us." Monday's Rosh Hashanah observation thinned ranks at many firms. High-grades, particularly at the long end, were slightly weaker, he said.
The high-yield market lost 1/2 point to a point yesterday.
"I just think people are liquidating positions because of the calendar," one high-yield trade said, adding that issuers are readying some $10 billion of high-yield debt for sale.
Losers of late include R.H. Macy & Co.'s 14 1/2% debt of 1998 and DR Holdings Inc.'s 15 1/2% senior subordinated debentures of 2002.
Macy's bonds have lost three to four points in the past week because of "bad earnings and people getting a little nervous." DR Holdings bonds had lost about 10 points in the previous day, he said.
New Issues
General Electric Capital Corp. issued $500 million of 3.15% notes due Oct. 6, 1993. Priced initially at par, the noncallable notes were reoffered at various prices through Morgan Stanley and rated triple-A by Moody's Investors Service and Standard & Poor's Corp.
Amoco Canada Petro issued $300 million of 7.95% debentures due 2022. Noncallable for 10 years, the bonds were priced at 98.638 to yield 8.071%, or 70 basis points over comparable Treasuries. Moody's and Standard & Poor's rates the bonds tripe-A. Goldman, Sachs & Co. lead managed the offering.
Philip Morris Cos. issued $250 million of 7.125% notes due 2004. the noncallable notes were priced at 99.05 to yield 7.245%, or 88 basis points over 10-year Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A. Morgan Stanley lead managed the offering.
Transcanada Pipelines Ltd. issued $200 million of 8.5% debentures due 2023. Noncallable for 10 years, the debentures were priced at 99.776 to yield 8.52%, or 115 basis points over 30-year Treasuries. Moody's rates the offering A3, while Standard & Poor's rates it A. Morgan Stanley lead managed the offering.
Anheuser-Busch issued $200 million of 6.9% notes due 2002. Noncallable for seven years, the notes were priced at 99.933 to yield 6.909%, or 55 basis points over comparable Treasuries. Moody's rates the offering Al, while Standard & Poor's rates it AA-minus. Dillon, Read & Co. lead managed the offering.
Federal Home Loan Mortgage Corp. issued $100 million of 6.18% debentures due 1999 at par. Noncallable for three years, the debentures were priced to yield 30 basis points over comparable Treasuries. Morgan Stanley sole managed the offering.
Coca-Cola issued $150 million of 6.625% notes due 2002. The noncallable notes were priced at 99.322 to yield 6.719%, or 36 basis points over the comparable Treasuries. Moody's rates the offering Aa3, while Standard & Poor's rates it AA. Goldman Sachs managed the offering.
Federal Home Loan Banks issued $50 million of 5.50% debentures due 1997 at par. Noncallable for a year, the bonds were priced to yield 17.5 basis points over comparable Treasuries. First Union Securities Inc. managed the offering.
Rating News
Consolidated Edison Company of New York's shelf registration for $400 million of unsecured debt securities has received a preliminary A-plus rating from Duff & Phelps Credit Rating Co.
Together with a previous filing, Con Ed now had $525 million of unsecured shelf debt available for sale. The company will use proceeds for general corporate purposes, including short-term debt repayment and construction funding.
"Con Ed had maintained a strong long-term financial profile," Duff & Phelps said in a release.
