US primary market issuances stood at $24.5bn last week vs. $27.7bn a week prior. IG issuances stood at $16.3bn led by Oracle’s and IBM’s $5.25bn and $3.25bn four-tranchers each. HY issuances stood at $8.1bn led by Uniti Group’s $2.6bn and CCO Holdings’ $1.1bn issuances. In North America, there were a total of 36 upgrades and 52 downgrades across the three major rating agencies last week. As per Lipper data, US IG bond funds saw outflows of $582mn for the week ended February 1, following last week’s haul of $3.28bn, snapping a three-week streak of inflows totaling almost $13bn.. HY bond funds saw $1.5bn of outflows in the week ending February 1, following last week’s $1.28bn in outflows. Looking at credit, CDS spreads across all regions are at its tightest levels in over a month, as seen in the box & whisker chart below.
LatAm saw $3.6bn in new deals last week as compared to $2.74bn in deals a week prior with Pemex raising $2bn and Codelco’s $900mn deals. Pemex’s 10Y deal was priced wider to its entire curve with an attractive yield of 10.375%. In South America, there was 1 upgrade and 15 downgrades across the major rating agencies. EU Corporate G3 issuance stood at $13.5bn vs. $25.3bn a week prior. Issuance volumes were led by Landesbank Hessen’s $3.05bn multi-trancher deals and Nordea Bank’s €1bn issuance. Across the European region, there were 37 upgrades and 30 downgrades. The GCC G3 primary bond market saw $238mn in deals last week as compared to no deals in the week prior to it. DAMAC Real Estate raised the majority with a $200mn deal. Across the Middle East/Africa region, there were no upgrades and 17 downgrades across the major rating agencies.
APAC ex-Japan G3 issuances saw $2.3bn in issuances vs. $2.2bn in the week before that with ANZ Bank raising ~$1.24bn via a multi-currency deal and Bank of New Zealand’s $850mn issuance. Another noteworthy deal was Commerzbank raising S$300mn via a 10.25NC5.25 Tier 2 bond at a yield of 5.7%. The deal saw a 58% allocation to private banks. In the APAC region, there were 4 upgrades and 4 downgrades combined across the three rating agencies last week.