Digg
We noted earlier that the deluge of corporate borrowing was continuing today, with several more investment-grade behemoths taking advantage of rock-bottom interest rates. Junk-bond issuers are having an historically busy today, too.
There could be nearly $7 billion in new high-yield deals in the market today, according to Anusha Shrivastava of Dow Jones Newswires, including a $3.5 billion bond from Chrysler and $1.8 billion in borrowing by Dish/Echostar.
The day’s volume is “among the biggest one-day totals we’ve seen,” says Guy LeBas, strategist at Janney Montgomery Scott.
High-yield issuance is likely to hit $13 billion this week, according to Standard & Poor’s Leveraged Commentary & Data Group, which would be the second-highest on record, after $21.6 billion one week last August.
Investor demand for this stuff is so strong that Chrysler raised the size of its offering to $3.5 billion from $2.5 billion, Anusha reports.
These companies are paying higher interest rates than blue-chips like Johnson & Johnson, but junk-bond yields are still remarkably low. The average yield on the Barclays Capital high-yield index has dropped to 6.61%, the lowest on record.
MySpace
Digg
del.icio.us
StumbleUpon
Error message
MarketBeat looks under the hood of Wall Street each day, finding market-moving news, analyzing trends and highlighting noteworthy commentary from the best blogs and research. MarketBeat is updated frequently throughout the day, helping investors stay on top of what's happening in the markets. The Wall Street Journal's Chief Markets Commentator Dave Kansas and MarketBeat lead writer Matt Phillips spearhead the MarketBeat team, with contributions from other Journal reporters and editors. Have a comment? Write to marketbeat@wsj.com or write Dave at dave.kansas@wsj.com or Matt at matt.phillips@wsj.com.
Read Full Article »