Latest news with #corporatebonds
Reuters
22-07-2025
- Business
- Reuters
De-risking mood adds more demand for US corporate bonds
July 21 (Reuters) - Investors have begun to de-risk their equity portfolios and buy more investment-grade corporate bonds as U.S. stock indices near new record highs, in turn pushing corporate borrowing costs to their tightest levels since 1998 for the second time in eight months. Credit spreads have recovered since they were forced sharply wider on April 2, or 'Liberation Day', when President Donald Trump announced trade tariffs and the market became uneasy about corporate fundamentals in a potential environment made susceptible to inflationary pressures and slower economic growth. The average investment-grade bond spread last stood at 80 basis points (bps), which is just 3 bps away from its lowest point of 77 hit in 1998 and had previously touched last November, according to ICE BAML data. It had touched 121 bps, or its highest since November 2023, in the days after Liberation Day. The recovery has come on the back of optimism, confirmed by recent corporate earnings, that the highest-rated companies had used the past year to reform balance sheets by paying down debt, avoiding costly acquisitions, and were prepared for an economy impacted by the inflationary impulse of tariffs or a trade war. "The sharp tightening of credit spreads seen since Liberation Day is based on perception that trade and tariff risks have peaked. . .it also can be attributed to investors' confidence in US corporate fundamentals," said Edward Marrinan, credit strategist at SMBC Nikko Securities. The Federal Reserve's reluctance to cut interest rates substantially, with inflation still stubbornly above preset targets, has also kept corporate bond yields high enough to attract strong demand from yield-focused investors like insurance companies and pension funds. But worries that corporate valuations are nearing a peak have also prompted some investors to shift money from equities to investment-grade corporate bonds, adding an extra level of pressure on credit spreads, said bankers. This heightened investor demand coupled with an overall market shift out of equities into debt could push spreads tighter in the coming months, said Michael Levitin, managing director and co-head of liquid credit at asset management firm MidOcean Partners. "For the first time that I can think of in my career, we're seeing a shift out of equities into debt," he added, noting it was driven by those beginning to realize they may not get the same return out of equities as they did before. "We have had more conversations, interest in credit strategies and investment-grade fixed income given the run-up in equities," said Nick Elfner, co-head of research at Breckinridge Capital Advisors. About $10 billion has moved out of domestic equity funds and ETFs since the beginning of 2025, at the same time as over $180 billion has flowed into taxable bond funds and ETFs, according to data from the Investment Company Institute. This reflects the added demand for fixed income, Elfner noted. Companies in the meantime are taking full advantage of this rush of demand for their bonds and raising new debt, while paying little to no new-issue premium as order books are heavily oversubscribed. The average new issue concession on nearly $51 billion of corporate bonds issued in July was a measly 2 bps with order books covered by over four times, according to Informa Global Markets data. To be sure, analysts and strategists expect this dream run in spreads to reverse, albeit gradually, in the second half, especially if the current optimism about the tariff impact on credit fundamentals is found to be misplaced. "Our base case for (investment grade) credit spreads is widening, not tightening, as we have a forecast of 110 bps through year-end, but that number is still well within the long-term median level for spreads (of) 130 bps,' said Winnie Cisar, global head of strategy at CreditSights. Companies have had a lot of power to push through pricing to consumers and maintain strong margins despite these macroeconomic headwinds - yet a period of rising interest rates means interest coverage has come down from record highs in 2021 and created a mixed picture for credit fundamentals, Cisar added. "If interest expense is somewhat elevated and concerns grow around the trajectory for growth and profit margins, that could act as a catalyst for a widening in spreads."
Zawya
08-07-2025
- Business
- Zawya
Arab Palestinian Investment Co places 5-year bonds worth $120mln
Arab Palestinian Investment Company (APIC) has issued five-year corporate bonds in three tranches denominated in the US dollars, Jordanian dinars, and Euro for a total value of $120 million, of which $76.7 million, 22.64 million dinar and €10 million through a private placement. Arab Bank, Cairo Amman Bank, Quds Bank, Bank of Palestine, Bank of Jordan, Jordan Ahli Bank, the Housing Bank for Trade and Finance, the Palestine Deposit Insurance Company and the International Finance Corporation (IFC) participated in the offering. The proceeds of the issuance will be used to support the company's capital and expand investments in the region. Earlier in May, APIC's shareholders approved the issuance of corporate bonds with a total nominal value of up to $110 million with an option to increase it to $120 million. The Palestine Exchange-listed APIC is a diversified investment company and invests across sectors in Palestine, Jordan, Saudi Arabia, the UAE, Iraq and Turkey.
Zawya
08-07-2025
- Business
- Zawya
APIC issues new corporate bonds through three tranches denominated in US Dollars, Jordanian Dinars and Euros
With the participation of the International Finance Corporation (IFC) Ramallah, Palestine: Arab Palestinian Investment Company (APIC) has successfully issued new five-year corporate bonds through three tranches denominated in the US dollars, Jordanian Dinars, and Euro currencies with a total nominal value of USD 120 million, of which USD 76.7 million, JD 22.64 million and €10 million through a private placement. Nine prominent banks and financial institutions participated in this issuance including Arab Bank, Cairo Amman Bank, Quds Bank, Bank of Palestine, Bank of Jordan, Jordan Ahli Bank, the Housing Bank for Trade and Finance, the Palestine Deposit Insurance Company and the International Finance Corporation (IFC). Earlier in May, APIC's General Assembly approved and ratified the issuance of new corporate bonds with a total nominal value of up to USD 110 million with an option to increase it to USD 120 million during its extraordinary meeting that took place in Ramallah. In his statement, Tarek Aggad, Chairman of the Board and CEO of APIC, said that this marks a significant step in reinforcing APIC's capital structure and supporting its continued growth and investment in vital sectors across Palestine and the region. He noted that the total subscriptions exceeded the initially offered nominal amount of USD 110 million, reaching USD 126.144 million. Accordingly, the increase option to USD 120 million was exercised, and the necessary allocation was completed with the approval of the Palestine Capital Market Authority. Aggad expressed his appreciation to all the institutions that participated in the APIC bonds subscription, emphasizing that their participation demonstrates their strong confidence in APIC group especially amidst the current challenges in Palestine and the region, most notably the severe and ongoing humanitarian and economic crisis in Palestine, and the deep recession which have significantly impacted the performance of the Palestinian Economy. He noted that several of the banks that had subscribed to the first, second and third bond issuances in 2012, 2017 and 2020 have since renewed their subscriptions for this fourth issuance, which demonstrates the great trust that the bondholders have placed in APIC over the years. 'IFC Signs USD 15 Million Subscription Agreement in APIC Bonds' In this respect, and during a formal ceremony held at APIC offices in Amman, Jordan, the International Finance Corporation (IFC), a member of the World Bank Group and its investment arm, signed a bond subscription agreement with APIC valued at USD 15 million. The agreement was signed by Mr. Tarek Aggad, Chairman and CEO of APIC, and Mr. Ashruf Megahed, Regional Head for Manufacturing, Agribusiness & Services at IFC. Welcoming the partnership, Aggad stated: "We are proud of IFC's decision to subscribe to APIC bonds. This investment represents a strong vote of confidence in APIC's vision, performance, governance, and resilience in facing challenges. This investment carries particular significance given the intensive and lengthy due diligence process for APIC Group on various levels including managerial, financial, environment, social and governance practices that preceded the signing of this agreement. This partnership reaffirms the strength of our operations, transparency, and unwavering commitment to adhering to the highest international standards and practices." In his statement, Megahed noted: 'This marks IFC's largest private sector transaction in West Bank and Gaza and is expected to help create jobs across different sectors and drive sustainable growth. It stands as a testament to our unwavering commitment to bolstering the private sector in some of the most challenging environments and during times of profound fragility." About APIC APIC is a public shareholding investment company listed on the Palestine Exchange (PEX: APIC). It holds diversified investments across the manufacturing, trade, distribution and service sectors in Palestine, Jordan, Saudi Arabia, the United Arab Emirates, Iraq and Turkey through its group of subsidiaries: Siniora Food Industries Company; Unipal General Trading Company; Palestine Automobile Company; Medical Supplies and Services Company; National Aluminum and Profiles Company (NAPCO); Reema Hygienic Paper Company; Sky Advertising and Promotion Company; Arab Leasing Company and Arab Palestinian Storage and Cooling Company, employing over 3,400 staff through its group of subsidiaries. For more information, visit
NHK
08-07-2025
- Automotive
- NHK
Nissan plans to raise $5.1 billion by issuing new bonds
Nissan Motor plans to raise about 750 billion yen, or around 5.1 billion dollars, by issuing new corporate bonds to cover the costs of repaying outstanding bonds and developing electric vehicles. The struggling Japanese automaker posted a massive net loss of more than 670 billion yen, or about 4.6 billion dollars, in the fiscal year that ended in March. The company needs to finance the redemption of bonds maturing this fiscal year, for a total of about 3.8 billion dollars. Nissan announced a plan on Monday to raise about 1 billion dollars by issuing convertible bonds. It also plans to sell straight bonds worth about 4.1 billion dollars. The funds from new bond sales will be invested in growth areas such as development of electric vehicles and next-generation cars that can be upgraded through software updates, and for redemption of existing bonds. Nissan earlier announced that it will cut its group-wide payroll by 20,000 workers and close seven factories in and outside Japan. Analysts are closely watching whether Nissan can implement an effective growth strategy to rebuild the company.
Bloomberg
07-07-2025
- Business
- Bloomberg
Chile Investors Rediscover Their Appetite for Risk, Survey Shows
As a turbulent year on global markets finally begins to calm, Chile fixed-income investors are rediscovering their appetite for risk. More than 70% of analysts and traders polled by Bloomberg said they prefer corporate bonds over Treasury notes, the highest percentage since Bloomberg resumed the monthly survey in March. At the same time, those who said they would avoid anything rated less than AAA fell to the lowest in at least five months.
