12 jun: CORRECT: PNC Sees More Demands to Buy Back Bad Mortgages
12 jun: Dell To Initiate Quarterly Dividend
12-06-2012 22:36:00

Bond Issuance Continues As Six Companies Sell $2.5 Billion

Relateret indhold

By Patrick McGee

Companies are continuing to bring new debt deals to the market before Greece holds parliamentary elections on June 17, an event that has the potential to hurt risk sentiment and dry up bond issuance.

Six high-grade companies are issuing more than $2.5 billion combined Tuesday, following a $6.95 billion tally on Monday. The slew of deals to start the week indicate companies are confident they can find investors and borrow at low interest rates, yet they also suggest some nervousness about selling bonds later this month, according to market participants.

Unlike Monday, when five of the deals were for $750 million or more, including a $2 billion offering from AT&T Inc. (T), most of Tuesday's deals are small. Two 10-year transactions from Brazil led the way--Banco do Brasil (BBAS3.BR, BDORY) is selling $750 million, and aerospace and defense company Embraer SA (ERJ, EMBR3.BR) is selling $500 million--along with a $400 million deal from New York-based agribusiness Bunge Ltd. (BG).

Low interest rates continue to entice a variety of borrowers into the market, while investors are feeling comfortable, thanks to a wider-than-usual risk-premium, or spread, owing in part to ultralow Treasury rates.

According to Barclays, the average corporate bond yield was 3.32% Monday, just 0.07 percentage point from the all-time low. The average spread was 2.07 points, versus an average of 1.82 points over the past two years.

The dynamic enabled Embraer to cut the offered yields on its 10-year bond to 5.15%, versus 5.375% in original pricing guidance. Banco do Brasil launched its deal at 6%, versus 6% to 6.125% at original guidance, and it found the terms favorable enough to increase the size of its deal to $750 million from an original $500 million.

Other deals included a $300 million, 10-year deal from Florida Gas Transmission Co., a $325 million, subordinate debt deal from NextEra Energy Inc. (NEE), and a $250 million, five-year offering from Sallie Mae parent SLM Corp. (SLM).

The new deals found a receptive audience despite a mixed backdrop, with Markit's CDX North America Investment Grade Index, a proxy for risk sentiment, weakening between 0.3% and 1% in afternoon trading.

MarketAxess showed actively traded financial bonds were losing value to Treasurys, but nonfinancial corporates were stable or improving. Spreads jumped 0.14 percentage point on Goldman Sachs (GS) 2015 bonds and 0.05 point on J.P. Morgan (JPM) 2022 bonds, for instance, but Deere & Co. (DE) 2022 bonds tightened 0.04 point, and the 2043 bonds from natural gas company NiSource Inc. (NI) improved 0.06 point.

Deere and NiSource were each issued in the last week. When newly issued bonds improve in the secondary market, it helps persuade more investors and issuers to take part in the primary market.

Demand for new offerings could also be seen in the $1 billion offering from Hydro-Quebec, a government-owned public utility, and the five-year, $1.25 billion covered bond deal from National Australia Bank Ltd. (NABZY, NAB.AU). Neither is classified as a corporate bond by data provider Dealogic, which tracks issuance.

Hydro-Quebec sold five-year bonds to yield 1.399%, or 0.65 percentage point over the Treasury rate, while National Australia Bank Ltd. was on track to sell its bonds at 1.0 point over an industry standard midswap price.

The covered bonds are backed by the bank as well as a pool of Australian prime residential mortgages, earning them triple-A ratings.

Write to Patrick McGee at patrick.mcgee@dowjones.com

(END) Dow Jones Newswires

June 12, 2012 16:36 ET (20:36 GMT)

Copyright (c) 2012 Dow Jones & Company, Inc.

Opret kommentar

Relateret debat

  • 1 uge
  • 1 måned
  • 1 År
Ingen indlæg

Fondsbørsmeddelelser

Vestas vinder ordre på 34 MW i Tyrkiet - NY

19-12-2014 16:36:45
Vestas har fredag vundet en tyrkisk ordre på levering af 17 vindmøller med en samlet kapacitet på 34 megawatt.Det fremgår af en pressemeddelelse fra den danske ..

Novo Nordisk: Tresiba får positiv anbefaling om brug til børn

19-12-2014 13:26:58
En lægemiddelkomité under de europæiske sundhedsmyndigheder, EMA, anbefaler en udvidet indikation af diabetesmidlet Tresiba.Lægemiddelkomitéen, CHMP, anbefaler,..

Aktier/middag:Carlsberg presset i positivt C20

19-12-2014 11:42:20
Noget tyder på, at julestemningen har smittet af på investorerne på det danske aktiemarked. I hvert fald gør købelysten på det danske C20 Cap-indeks sig gældend..

Mest læste nyheder

  • 24 timer
  • 48 timer
  • 1 uge

Relaterede aktiekurser

NAT Bank FPO 32,66 2,9% Stigning i aktiekurs
SLM Corporation 9,89 -0,9% Fald i aktiekurs
Deere & Co 90,10 0,6% Stigning i aktiekurs
Goldman Sachs Group Inc 193,28 0,9% Stigning i aktiekurs
NextEra Energy Inc 105,87 0,4% Stigning i aktiekurs
NiSource Inc (Holding Co.. 41,73 0,4% Stigning i aktiekurs
Embraer SA 36,33 0,0% Stigning i aktiekurs
Bunge Ltd 90,39 -1,5% Fald i aktiekurs

Køb- og salgsanbefalinger

  • Trend
  • Pengemaskinen
Sælg

Relaterede selskaber
Få adgang til information og anbefalinger af relaterede selskaber med PLUS pakken.

Du får adgang til 7 værdifulde investorværktøjer til investering.

Klik her og læs mere om PLUS pakken.

Copyright Euroinvestor A/S 2014  Disclaimer Privatlivspolitik
Aktieinformation leveres af Interactive Data.
Data er forsinket 15-20 minutter iht. de enkelte børsers regler om videredistribution.
 
21. december 2014 03:37:01
(UTC+01:00) Brussels, Copenhagen, Madrid, Paris
Version: LiveBranchBuild_20141211.1 - EUROWEB4 - 2014-12-21 03:37:01 - 2014-12-21 03:37:01 - 1 - Website: OKAY

Når du besøger Euroinvestor.dk accepterer du, at der anvendes cookies, som vi og vores samarbejdspartnere benytter til funktionalitet, statistik og markedsføring. Læs mere om cookies på Euroinvestor.dk her

x