Total investment grade issuance has now topped $45 billion month-to-date. With a week to go, the month may end up topping the previous estimate of $40-50 billion. The primary market was slow coming off the holiday weekend as increased volatility in spreads and rising Treasury yields dissuaded issuers from accessing the market. That said, investor appetite still appears healthy and the strong demand for the Ford convertible-upsized to $4.5 billion, the largest deal ever in that market-generated positive momentum. Important deals of the week included a Household's $2.5 billion 5-year, Italy's $5 billion global and a two-tranche $2 billion deal for GMAC. The high yield new issue market also remains active, carrying over from above average months in November and December. A total of $7.6 billion of high yield debt has been issued thus far this month as flows into high yield funds and the prospect of a drop in default rates augers well for the sector.
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