The calendar picked up again, with about $20 billion in dollar issuance hitting the investment grade, high yield and emerging markets. The highlight of the week was the AT&T jumbo deal, which was the second largest U.S. corporate bond on record. AT&T doubled the deal size to $10 billion in the face of strong demand from U.S. investors reaching for yield given the gap down in Treasury yields since the suspension of the 30-year auctions. The 10- and 30-year tranches were each $2.75 billion in size and reportedly had books behind them of over $10 billion each. The 30-year bond, which priced at +295 bp to Treasuries tightened about 20 bp on the break. The 10-year tightened about 15 bp. Overall, the market seems in very strong technical position with significant pools of cash to be put to work in both Europe and the United States. The decline in the 'war' premium given the successes this week in Afghanistan has also underpinned spreads.
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