Big Bad Bond Index Rises 3 Points, Lead By Wal-Mart (WMT) & GE


The Big Bad Bond Index (BBBI), which tracks high grade corporate bonds, slightly rose closing at  1,151.27.  This means the average bond in the index was trading at $1,151.27, based on the last trade of the day. Twenty one bonds ended higher and six lower. The average yield fell 0.05% to 2.30%.

The biggest gainer on the day was General Electrics’ (GE) 5.25% coupon bond maturing 12/2017 which gained over  $18 per $1000 face value bond. Ironically, GE’s stock spent the entire day in negative territory following an announcement that its workforce had increased nearly 5% and a Bloomberg report that some important patents were expiring. Other large gainers included bonds from Wal-mart Stores (WMT) and Verizon (VZ).

One of the day’s losers (there were not many losers, and the losses were small)  of the day was Dupont (DD). Its 4.88% coupon bond maturing 4/2014 lost a little over $2. The bonds of Disney (DIS) and Hewlett Packard (HPQ) were down a smidgen.

The 2, 10, 30  year treasury bonds all gained value today. The yield on the 10 year lost 0.05% closing at 1.93%. The 10 year treasury and BBBI showed similar performance.



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