The primary market picked up on the week as issuers took advantage of positive sentiment in the market to bring deals. In total about $7.8 billion in high-grade debt came to market, with notable deals from the bank and finance sector (Goldman Sachs, Lehman Brothers, Bank of New York, MBNA) as well as transactions from benchmark borrowers like Dow Chemicals, DuPont and Unilever. Signaling strong demand for perceived safe haven credits, Pepsi Bottling issued $1 billion 10-year notes at just 80 basis points over Treasuries. The calendar should pick up in coming weeks as issuers try to take advantage of the window between now and Thanksgiving to get deals done. Historically low borrowing rates, decent cash on the sidelines and uncertainty as we head into the new year provide powerful incentives to borrow now.
Analysis by CreditSights, Inc., an independent online credit research platform. Call (212) 340-3888 or visit www.CreditSights.com for more information.