U.S. corporate bond sales top $45 billion in new year
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U.S. corporate borrowers raised nearly $16 billion in senior debt today, following Tuesday’s issuance of $29 billion in senior debt, getting off to a strong start in 2024. The surge in activity reflects companies taking advantage of strong investor demand ahead of upcoming economic data.
Pacificorp, a utility owned by Berkshire Hathaway Inc., is one of the issuers, guaranteeing $3.8 billion in bonds to address debt repayments and wildfire-related claims in Oregon and Northern California. Credit Agricole (OTC: CRARY ) and Hyundai Finance (OTC: HYMTF ) each sold $2.5 billion in notes in Wednesday’s trading.
Scott Schulte, head of investment-grade debt issuance at Barclays, attributed the rush to the “January effect,” in which investors turn to new capital after a lull in December.
There is great demand for these new bonds. The offerings were 2.83 times oversubscribed on Tuesday, according to Informa Global Markets.
In a notable performance on Tuesday, 16 borrowers issued $29.3 billion in bonds, the most since Labor Day last September and the second most in a year since 2023, according to a report Wednesday from BMO Capital Markets. Big start.
Reuters contributed to this article.
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