Weekly Supply & Flows Update from CreditSights
The primary market took center stage with a deluge of supply which weighed on spreads overall. Just over $23 billion in investment grade supply hit the market, with GE Capital's blockbuster $11 billion deal accounting for almost half of it. Bank and finance spreads were slightly wider as secondary trading was dominated by bonds being moved to accommodate the GE Capital mega-issue. The deal catapulted the finance company into the top five of new issues by deal size, with the distinction that it is the only non-telecom company in this elite group. Away from GE there was a rash of deals but despite the obvious weakening on the technical base that this is having, investors are still lining up to buy the bonds of companies that hit the sweet spot combining a clean bill of health on the accounting front, exposure to the cyclical upswing and some yield. Even some of the problem credits of the not-too-distant past are able to access the market as Williams came with a $1.5 billion two-tranche deal comprising 10- and 30-year bonds. High yield (including a $600 million deal from Turkey) printed $2.5 billion in new deals.
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