More on Corporate Bonds

March 27th, 2008 10:06 am | by John Jansen |

 Corporate bond spreads unchanged in the cash market this morning. The IG 10 is wider by 4 basis points at 137. The market is still queasy and one portfolio manager noted that the “bid side is just a suggestion”. The  main focus of the day is the Morgan Stanley 10 year note which is expected to price around 312 basis points cheap to Treasuries.That would make it 40 cheap to comparable Morgan Stanley debt.

Goldman Sachs sold a 10 year several days ago at 270 to the 10 year and 15 cheap to its comps. The issue briefly ran to about 260 and has widened back out to 280 bid.

Shares of some of the big investment banks are taking sharp hits today. Lehman is off about 7 percent andMerrill and Goldman are off 3 percent and 2 percent ,respectively. That will weigh on spreads if it continues.

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