The market is clearly suffering from indigestion as it continues to absorb debt on pace to rival last year's record issuance. About $13.4 billion of investment grade debt hit the market in the week ended April 11, bringing the total issuance for the year to $188.7 billion or on-pace for another record year. The oil & gas and utility sectors were very active, with new deals priced for Apache ($400 million 10-years), Duquesne Light ($200 million 10-years), Kerr-McGee ($350 million 3-years), Valero ($750 million each of 10s and 30s and $300 million 5s) and Progress energy ($350 million 5s and $450 million 10s). Meanwhile, the disarray in the telecom sector is affecting even the better names in the sector. AT&T Wireless was forced to increase spreads 30-35 bp over to +300 bp for its $3 billion deal. It remains very much a split market, with untainted BBBs seeing strong demand on the back of economic recovery hopes and any credit with a hint of SEC or accounting troubles going begging.
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