U.S. high yield bond issuance rebounded to $8 billion last week, ending a Labor-Day hiatus that saw no volume over the preceding two weeks. Much of the activity, of course, was courtesy BB-/B1 rated Sprint, which completed a $6.5 billion offering backing corporate purposes (full details here). That deal is the third-largest high yield issue ever, trailing only TXU ($7.5 billion) and First Data ($7.065), both from the 2007-08 era, according to LCD's Matt Fuller.
With last week's activity, new-issue bond volume in the U.S. this year totals $216 billion via 446 offerings, slightly ahead of the $209 billion seen at this point last year. The full year total for 2012 was $346 billion, a record. The September activity is welcome, as it follows what turned out to be a lackluster August, which saw only $14.3 billion in issuance, according to S&P Capital IQ/LCD. (For comparison, August 2012 saw a relatively hefty $30 billion in issuance.)
The uptick in volume is set against uneven investor sentiment. U.S. high yield funds saw a $416 million net cash outflow last week, thanks largely to ETFs, which were hit with considerable withdrawals, according to Lipper. For the year, U.S. high yield funds have seen a net $7.6 billion outflow, compared to a whopping $22.2 billion inflow during the same period in 2012, says Fuller, citing Lipper.
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