Primary supply continued to build last week, contributing to the growing discord between primary and secondary market trading, with market trades continuing to be affected by the corporate spread widening. Pricing on the primary side continues to offer investors some relief, with several of last week's deals pricing at the wide end of talk.

Industry sources said the general spread softening seen in the primary should continue for the next few months but did not expect to see any major spread widening in the short term. Trades in the secondary offered investors some arbitrage at the start of last week, particularly in CMBS where the recent deluge of primary issuance continues to add pressure on trades.

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