uploads///US Investment Grade Bond Market Issuance

Investment-Grade Corporate Bond Issuance Rose on the Week


Nov. 18 2015, Updated 5:41 a.m. ET

Deals and volumes of investment-grade corporate bonds

Investment-grade corporate bonds worth $32.93 billion were issued in the primary market in the week ending November 13, 2015. Investment-grade corporate bond issuance rose 0.2% from the previous week. However, the number of issuers fell from 30 to 28 in the previous week.

Yields on investment-grade corporate bonds rose in the week ending November 13. As a result, weekly returns of the John Hancock Bond Fund Class A (JHNBX) and the Strategic Advisers Core Income Fund (FPCIX) fell by 0.06% and 0.07%, respectively.

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Major Issuers

AstraZeneca (AZN), Chevron Corporation (CVX), Australia and New Zealand Banking Group Limited, and MetLife (MET) were among the biggest issuers of investment-grade bonds in the week ending November 13.

Issuance by quality and maturity

Fixed-rate issues formed 92.5% of the total issuance last week. Floating-rate issues worth $2.5 billion were raised last week.

When we look at the credit ratings of issuers, we see that A rated issuers were the most prolific. They made up 43.4%, or $14.3 billion, of total issuance. They were followed by AA rated issuers, which formed 26.6% of the week’s issuance. BBB rated papers formed 25.2% of the total issuance.

In terms of maturity, the largest chunk of issuance, making up 33.6% of all issuance, was the five-year maturity category. It was followed by the ten-year maturity category, which commanded 28.5% of the total issuance. The three-year maturity category made up 14.9% of total issuance.

Long-term maturity categories such as 30-year and >30-year made up 16.4% and 0.5%, respectively, of the total issuance. Perpetuals did not see any issuance last week.

In the next part of the series, we’ll highlight last week’s major deals—including pricing, credit rating, and yields.


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