Loans and High Yield

The summer break in European corporate bond markets has shortened in recent years to as little as two weeks in August, but investors know that the dollar market is always an option.

Recent cash flows from funds buying European corporate bonds and loans with speculative grade ratings have increased with support from US investors, as markets get ready for the second half of the year.

Italian construction group Astaldi’s bonds have taken a beating on concerns that its exposure to Turkish risk could derail plans for injection of needed capital. For some high yield investors, it also is a reminder of market vulnerabilities ahead.

Chinese information technology company Digital China Group is tapping the offshore loan market for a $100m deal.

Sterling high yield issuers have printed less than half the volume of bonds they sold during the same period last year, which many attribute to the uncertainties surrounding the UK’s exit from the European Union. But appetite for sterling risk appears resilient for now.

Singaporean hard-drive manufacturer MMI International is seeking a $205m loan, mainly to refinance an old borrowing sealed in 2015.

Beijing Properties sold a two year bond last week after getting demand from some of the Chinese banks who joined the deal. That allowed the leads to launch the bond with little worry it would drag on over the weekend.

The nominations for GlobalCapital's Sustainable and Responsible Capital Markets Awards 2018 have been revealed, as a result of our worldwide market poll, conducted in July.

Sports Direct announced it has bought House of Fraser on Friday, but the retailer had already entered into administration just hours earlier, meaning investors will be unable to trigger what would have been a lucrative change of control covenant in the firm’s bonds.

Reliance Communications’ 2020 bond, which the company defaulted on last year, suffered a tumultuous week, hitting a new low after the telecoms company offered to buy back the $300m senior notes at a steep discount.

Taiwanese semiconductor producer Pan Jit International and its subsidiary Pan Jit Asia International are seeking a $190m-equivalent borrowing in two currencies.

Elon Musk’s sensational claim to have funding in place to take Tesla private stunned the US capital markets this week, but the lack of substantive detail to the plan has largely reversed an initial rally in the firm’s equity and debt instruments, as well as reportedly drawing the attention of the Securities Exchange Commission. Aidan Gregory and David Bell report.