Tags: US | Corporate | Bond | Sales

US Corporate Bond Sales Pass $1.5 Trillion for Annual Record

Monday, 01 December 2014 04:59 PM

U.S. corporate bond sales swelled to an annual record as a late-year rush by companies to lock in low interest rates pushed offerings for 2014 pass $1.5 trillion.

Bolstered by issues last month including $8 billion from Internet commerce company Alibaba Group Holding Ltd. and a $17 billion sale Monday by heart-rhythm device maker Medtronic Inc., volume passed the previous high of $1.494 trillion set last year.

Companies have offered $1.168 trillion of investment-grade notes in 2014 and $344 billion of junk bonds, propelled by multiple sales from Verizon Communications Inc. and General Electric Co., according to data compiled by Bloomberg. That outpaces the $1.146 trillion of high-grade notes and $348 billion of junk notes issued last year, the data show.

The surge in sales has been boosted by record-low borrowing costs as yields on corporate bonds in the U.S. fell to 3.57 percent in June and have since risen to 3.81 percent Nov. 30, according to the Bank of America Merrill Lynch U.S. Corporate and High Yield Index.

Verizon sold $14.8 billion of bonds this year while General Electric issued $13.2 billion, helping to drive investment-grade sales to the highest in data going back to 1999. Junk-bond sales were boosted by a $10.675 billion offering in April from billionaire Patrick Drahi’s companies Numericable Group SA and Altice SA, the data show.

High-yield, high-risk, or junk, bonds are rated below Baa3 by Moody’s Investors Service and BBB- at Standard & Poor’s.

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U.S. corporate bond sales swelled to an annual record Monday as a late-year rush by companies to lock in low interest rates pushed offerings for 2014 pass $1.5 trillion.
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2014-59-01
Monday, 01 December 2014 04:59 PM
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