{"id":147337,"date":"2021-01-05T04:59:00","date_gmt":"2021-01-05T01:59:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/corporate-debt-boom-resumes-as-2021-kicks-off\/"},"modified":"2021-01-05T04:59:00","modified_gmt":"2021-01-05T01:59:00","slug":"corporate-debt-boom-resumes-as-2021-kicks-off","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/corporate-debt-boom-resumes-as-2021-kicks-off\/","title":{"rendered":"#\n  Corporate debt boom resumes as 2021 kicks off"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a261d1088b3c\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a261d1088b3c\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/corporate-debt-boom-resumes-as-2021-kicks-off\/#Borrowing_for_January_could_reach_100_billion_or_more_despite_lapse_of_Fed_program\" >Borrowing for January could reach $100 billion or more, despite lapse of Fed program<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/corporate-debt-boom-resumes-as-2021-kicks-off\/#January_is_a_big_month_for_debt\" >January is a big month for debt<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/corporate-debt-boom-resumes-as-2021-kicks-off\/#Joy_Wiltermuth\" >Joy Wiltermuth<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Corporate debt boom resumes as 2021 kicks off<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"Borrowing_for_January_could_reach_100_billion_or_more_despite_lapse_of_Fed_program\"><\/span>\n  Borrowing for January could reach $100 billion or more, despite lapse of Fed program<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000117867\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       The training wheels came off without a hitch.<\/p>\n<p> The lapse of the Federal Reserve\u2019s inaugural <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.federalreserve.gov\/foia\/letter-from-chair-powell-to-secretary-mnuchin-20201120.htm\" class=\"icon none\">corporate debt-buying program at year\u2019s end<\/a> didn\u2019t hold up the parade of highly rated companies  from borrowing in droves in the bond market Monday.<\/p>\n<p>Home Depot Inc.<br \/>\n        HD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208081807\/composite\" class=\"negative\">-0.64%<\/bg-quote><br \/>\n       and John Deere Capital Corp.<br \/>\n        DE,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/207941296\/composite\" class=\"negative\">-0.52%<\/bg-quote><br \/>\n       were among the lineup of companies that in the first trading day of 2021 raced to borrow from the deep well of the U.S. investment-grade bond market.<\/p>\n<div class=\"paywall\">\n       Both companies fetched attractive pricing for their debt, even as U.S. stocks sold off and a highly-contagious variant of COVID-19 found in California and upstate New York prompted a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.fnlondon.com\/articles\/shell-third-national-lockdown-confirmed-as-new-variant-spreads-across-england-20210104?mod=home-page&amp;adobe_mc=MCMID%3D67550588529869689911892061257403283274%7CMCORGID%3DCB68E4BA55144CAA0A4C98A5%2540AdobeOrg%7CTS%3D1609801582\" class=\"icon none\">new national lockdown in the U.K.<\/a><\/p>\n<p>\u201cIf people were looking for large new-issue concessions, they didn\u2019t see it today. I\u2019m hoping we will,\u201d said Tom Murphy, Columbia Threadneedle Investment\u2019s head of investment-grade credit, adding that the month of January often can bring heavy new-debt issuance.<\/p>\n<p>\u201cBut I\u2019ve always been in the camp that supply\u00a0comes when the market is well-functioning, which usually means tighter spreads,\u201d he said.<\/p>\n<p>Spreads are the amount investors are compensated on bonds above a risk-free benchmark, often Treasurys<br \/>\n        TMUBMUSD10Y,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.000%\" channel=\"\" class=\"\">0.921%<\/bg-quote><span>.<\/span><br \/>\n       Bonds offering more spread can point to riskier investments or an overall skittish market. <\/p>\n<p>John Deere\u2019s farm-equipment financing arm was able to borrow $1.5 billion Monday through a two-part issuance. Its longest, 10-year class priced at a spread of 57 basis points above Treasurys, or a yield of 1.48%, according to a person with direct knowledge of the dealings. <\/p>\n<p>Home Depot sold a $3 billion three-part bond deal, with its 10-year slug priced to yield about 1.44%. Spreads tightened on both deals from initial levels, indicating high demand among investors, while lowering borrowing costs.<\/p>\n<p>Many large companies have been able to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/fred.stlouisfed.org\/series\/BAMLC0A0CM\" class=\"icon none\">borrow at rock-bottom rates<\/a> during the pandemic, mainly after the Fed this spring unveiled plans to start buying up corporate debt for the first time ever.  While the Fed never used a lot of its firepower, its backstop has been considered a vital cog in keeping credit flowing.<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>In November, Treasury Secretary Steve Mnuchin surprised markets after President Donald Trump\u2019s failed reelection bid, with an announcement that several emergency lending programs administered by the Fed would be allowed to expire on Dec. 31. This included the Fed\u2019s corporate bond-buying effort.<\/p>\n<p>By that time, the bulk of the record  $1.86 trillion U.S. investment-grade bond issuance for the year had already occurred, a 54% increase from 2019, according to BofA Global Research. While the team expects issuance to slow this year, a busy January still could mean another $100 billion or more of supply this month \u2014 the first without the Fed backstop. <\/p>\n<p>BofA\u2019s team put together this chart on past issuance in January and its 2021 forecast:<\/p>\n<div data-layout=\"inline\n              \" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetMediaIllustration\n          inline\n  article__inset\n        article__inset--type-InsetMediaIllustration\n          article__inset--inline\n  \"><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        renoImageFormat-\n        img-inline\n        article__inset__image\n      \" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<div style=\"padding-bottom:79.765625%;\" data-mobile-ratio=\"79.765625%\" data-layout-ratio=\"79.765625%\" data-subtype=\"\" class=\"image-container  responsive-media article__inset__image__image\">\n        <img decoding=\"async\" srcset=\"https:\/\/images.mktw.net\/im-280588?width=140&amp;size=1.2536728697355535 140w,\nhttps:\/\/images.mktw.net\/im-280588?width=540&amp;size=1.2536728697355535 540w,\nhttps:\/\/images.mktw.net\/im-280588?width=620&amp;size=1.2536728697355535 620w,\nhttps:\/\/images.mktw.net\/im-280588?width=700&amp;size=1.2536728697355535 700w,\nhttps:\/\/images.mktw.net\/im-280588?width=860&amp;size=1.2536728697355535 860w,\nhttps:\/\/images.mktw.net\/im-280588?width=1260&amp;size=1.2536728697355535 1260w\" sizes=\"(max-width: 140px) 100px,\n(max-width: 540px) 500px,\n(max-width: 620px) 580px,\n(max-width: 700px) 660px,\n(max-width: 860px) 820px,\n1260px\" src=\"https:\/\/images.mktw.net\/im-280588?width=620&amp;size=1.2536728697355535\" data-enlarge=\"https:\/\/images.mktw.net\/im-280588?width=1260&amp;size=1.2536728697355535\" alt=\"\" title=\"January is a big month for debt\"><\/div><figcaption class=\"wsj-article-caption article__inset__image__caption\" itemprop=\"caption\">\n<h4 class=\"wsj-article-caption-content\"><span class=\"ez-toc-section\" id=\"January_is_a_big_month_for_debt\"><\/span>January is a big month for debt<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>      <span class=\"wsj-article-credit article__inset__image__caption__credit\" itemprop=\"creator\"><br \/>\n            BofA Global<br \/>\n          <\/span><br \/>\n  <\/figcaption><\/figure>\n<\/div>\n<p>        Murphy said he expects issuance for January to reach almost $150 billion.<\/p>\n<p>\u201cAs long as rates stay in this Zip code, I\u2019m still going to expect more corporate bond issuance,\u201d said Wendy Wyatt, a portfolio manager at DuPont Capital. <\/p>\n<p>\u201cThe Fed stepped in and created ultimately liquity,\u201d she said, adding that a lot of the new debt has gone toward tendering and calling older bonds at today\u2019s low rates, meaning that leverage has not gone up so much. \u201cBut as a bondholder, I\u2019m still going to be leery about it.\u201d  <\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Joy Wiltermuth\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Joy_Wiltermuth\"><\/span>Joy Wiltermuth<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D1CC6B734F41%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Corporate debt boom resumes as 2021 kicks off &#8221; Borrowing for January could reach $100 billion or more, despite lapse of Fed program The training wheels came off without a hitch. The lapse of the Federal Reserve\u2019s inaugural corporate debt-buying program at year\u2019s end didn\u2019t hold up the parade of highly rated companies from&#8230;<\/p>\n","protected":false},"author":1,"featured_media":147338,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-147337","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/147337","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=147337"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/147337\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/147338"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=147337"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=147337"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=147337"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}