(Bloomberg) -- Debt sales in Europe’s primary market were at a brisk pace on Monday as companies sought to front-load their financings ahead of a slew of major central bank policy decisions, earnings reports and US data releases.
Vodafone Group Plc, NatWest Group Plc, AstraZeneca Plc, and Edenred SE priced €3.25 billion ($ 3.52 billion) in the single currency while South West Water Ltd. raised £400 million ($513 million) of 17-year money. This easily exceed the €2.59 billion raised in the whole of last week.
Stonegate Pubs, owner of the UK’s biggest pub operator, is also in the pipeline with a long-awaited refinancing. The amount of issuance is at odds with the usual summer slowdown. The equivalent week last year generated just €1.25 billion of sales.
Issuers might be “getting ahead of central bank meetings, PMI data on Thursday and especially Friday payrolls,” said Matthew Rees, head of global bond strategies at Legal & General Investment Management Ltd. Companies may also be looking to “get ahead of the big Magnificent Seven earnings this week, in case it brings back the market volatility we enjoyed last week, which may mean we get some decent size tomorrow,” he said.
The week ahead has a packed calendar, with interest-rate decisions due from the Federal Reserve, Bank of England and Bank of Japan, as well as a closely watched US jobs report to round off the week. Attention will also be on a deluge of earnings — especially those from tech giants Microsoft Corp., Meta Platforms Inc., Apple Inc. and Amazon.com Inc.
“Issuers want to get out before things really quieten down for the first two weeks of August, with holidays really taking over and the Olympics probably taking some attention away,” said Rees. “After Tuesday, we’d expect the rest of the week to be relatively quiet.”
The deals on Monday were met with strong demand — NatWest’s €700m offer gathered books of over €3.5 billion, while Vodafone’s €600m note attracted bids exceeding €1.75 billion.
Strong inflows into the primary have supported the market this year, as “expectations for rate cuts amplify the demand for corporate bonds,” wrote Ioannis Angelakis and Barnaby Martin, credit strategists at Bank of America Corp.
While there’s typically a summer slowdown, fund flows have actually re-accelerated “post French election volatility, and insurance buyers have resumed their buy programs,” wrote Mark Dowding, chief investment officer at RBC BlueBay Asset Management.
(Updates with deals final terms, book sizes. A previous version corrected South West Water deal size in second paragraph)
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