Bonds, Bonds, Bonds

 

• With some of the cheapest funding costs of the year on offer, it’s no wonder the floodgates have opened in the corporate bond market. 
• Credit risk premiums have been tightening as investors pour money into corporate bond funds.
• That’s encouraging companies to borrow, with AbbVie looking to price the year’s largest sale Tuesday, and at least 10 new deals in the junk-bond market.
• It all adds to a bullish outlook as recession fears have abated amid stronger economic data and progress in U.S.-China trade talks, Bank of America strategists said in a report Friday.
• Investors expect spreads to tighten further in the next three months, but could widen over the longer-term, the strategists said. With that in mind, issuers are looking to get in now while the getting’s good. 

(Source: Bloomberg)