(Bloomberg) -- Nearly two dozen companies flocked to the US high-grade bond market on Monday, making it the biggest day for issuance since early September as risk premiums stay persistently tight.
Sixth Street Lending Partners, BNP Paribas and Toyota Motor Credit Corp. are among the 22 firms announcing new bond offerings Monday, for the busiest day in four months by the number of issuers, according to data compiled by Bloomberg.
“2025 is marching in like a lion with over 20 deals announced this morning as companies rush to issue in what is effectively a three-day week for issuance,” said David Del Vecchio, co-head of US investment grade corporate bonds at PGIM Fixed Income.
Fixed-income markets will close early on Thursday in recognition of the state funeral for former President Jimmy Carter. Nonfarm payrolls will be released on Friday, making it another inactionable day.
“This feels like the first real day back in a sense from the holidays,” said Nicholas Elfner, co-head of research at Breckinridge Capital Advisors Inc. “We would certainly expect some stability in the macro environment, a good start to the year with equities, that the corporate bond market can open up like it normally does — with a vengeance in January.”
Syndicate desks are calling for $50 billion of deals this week, and between $175 billion and $200 billion overall in January as demand for corporate debt remains elevated.
High-grade yields opened the year higher than they have since 2009, JPMorgan Chase & Co. analysts led by Eric Beinstein and Nathaniel Rosenbaum wrote in a Monday note. Meanwhile, investment-grade risk premiums started the year at their tightest since at least 2000, they said.
“The ‘contest’ between tight spreads and high yields is continuing as 2025 begins, and recent history shows us that yields have been winning this battle,” wrote the analysts. “January issuance will be readily absorbed.”
--With assistance from Andrew Kostic.
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