Euro

The public sector debt market is providing high volumes of funding at astonishingly tight spreads as investors brush off political concerns and scramble to pick up what supply remains for 2017. However, central banks around the world are weighing on investors’ minds.

The European Union (EU) is set to tap an April 2031 line on Wednesday, coming on the heels of KfW five year benchmark on Tuesday, that raised €3bn.

All four investment grade benchmark corporate bond deals that priced last week were from utilities. On Tuesday, Italian multi-services utility, Iren, and Dutch grid operator, Stedin, took the count to six.

KfW hit screens on Monday, mandating three banks for a five year euro transaction.

UK grocer Tesco and US telecoms company Verizon both announced tender offers for some of their outstanding bonds in euros and sterling. Tesco is offering to buy up to £700m equivalent, while Verizon will confirm the size of its repurchase once it has sold new euro and sterling bonds.

Finnish property company, Mercada, was a lone issuer in the corporate bond market on Monday. Its €175m five year deal q was printed while issuers that completed roadshows last week paused.

Companies that have priced bonds in Europe this week have paid very small new issue premiums, but only four deals have been priced in euros. The sterling market was almost as busy, with three issues. Bankers are, however, working hard to bring deals to market.

Corporate bond deals are often executed on Fridays to give issuers some space in crowded weeks. However, Friday was one the busiest days of this week, with both euro and sterling investors offered long dated deals to consider.

BASF is set for a busy year in the bond market in 2018, after announcing on Friday that it had agreed to buy parts of Bayer’s seed and non-selective herbicide businesses for €5.9bn, all in cash.

Guarantor: Joint guarantee from Belgium, France and Luxembourg

Rating: Aa1/AA/AA

The BondMarker voters have spoken. The results are in for last week's solitary benchmark from Ireland.