The U.S. leveraged finance market continued to plod along last week as high yield bond investors took a step back from that market and leveraged loan investors pored over a limited offering of deals, amid noticeable appetite.
Specifically, junk bond issuance dipped to $3.8 billion last week from $6.3 billion the previous week, while leveraged loan activity edged to $3.5 billion, up from $2.1 billion, for a total of $7.2 billion last week, according to LCD, an offering of S&P Global Market Intelligence.
US leveraged finance issuance
That’s the smallest weekly total since the $4.5 billion in mid-March, and brings year-to-date U.S. leveraged finance volume to $193 billion: $121 million in leveraged loans (down 15% from YTD 2015) and $72 billion in high yield bonds (down 49%).
The big news in the junk bond market wasn’t about deals. Instead, for the first time in five weeks investors withdrew cash from the asset class $1.8 billion all but wiping out a month of inflows, according to Lipper.
The biggest offering was $1.8 billion in issuance from Hanesbrands HBI +0.83%, which refinanced 6.375% notes the new deal priced to yield less than 5% and revolving credit outstandings.
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The leveraged loan market, on the other hand, saw limited activity despite the first cash flow into the asset class since March, according to Lipper.
Belgium-based cable concern Telenet made the biggest market splash last week with an $850 million covenant lite loan to refinance existing debt.
Courtesy : forbes.com