Deals and volumes of investment-grade corporate bonds
High-grade bond issuance rose as markets calmed down after the Brexit vote. Investors are attracted to the US bond market due to higher yields—compared to other developed countries.
Investment-grade corporate bonds worth $31.7 billion were issued in the primary market in the week to July 1, 2016. High-grade issuance stood at $2.8 billion in the previous week. The number of issuers rose from six in the previous week to 17 in the last week.
Issuance by quality and maturity
Fixed-rate issues formed 99.2% of the total issuance, while floating-rate issues worth 250 million were issued last week.
The issuance was split between “A” rated and “BBB” rated issuers. “A” rated issuers made up 53.4%, or $17.1 billion, of the total issuance. “BBB” rated issuers formed 45.7% of the week’s issuance.
In terms of maturity, the largest chunk of issuance, making up 31.7% of all the issues, was in the five-year maturity category. It was followed by the ten-year maturity category. It commanded 23.5% of the total issuance. The three-year maturity category made up 7.1% of the total issuance last week.
The long-term maturity category such as the 30-year made up 24.0% of the total issuance. Meanwhile, the greater than 30-year category didn’t see any issuance. Perpetuals made up 0.3% of the total issuance last week.
In the next part of the series, we’ll highlight the major deals—including pricing, credit rating, and yields.