The US investment-grade corporate primary expects at least four issues to price on Thursday, most likely capping off a week of steady issuance ahead of the jobs report.
At least two offerings are expected to price in the high-yield corporate primary today.
Most of the week's consequential economic data releases are out today, including weekly jobless claims, Challenger job cuts and personal income and spending data for September, including the PCE inflation report.
The critical US jobs report for October is due out tomorrow morning.
On Wednesday, six IG offerings were priced in the primary totaling US$16.9bn, lifting weekly IG issuance to US$23.8bn, surpassing syndicate supply expectations for the week, and pushing IG supply for October to US$91.35bn, according to IFR data. The average new issue concession for yesterday's offerings was 1.21bp and the average order book was 3.55x subscribed, according to the data. The average price progression from initial price thoughts to pricing was 25.139bp tighter.
The slate of IG offerings materially pushed IG supply above weekly projections for approximately US$18bn, BMO said.
"Every month this year has now exceeded expectations and October needs $6.4bn in supply to become the 10th consecutive month to see at least $100bn in issuance," BMO said. "That is looking unlikely though with risk tone soft this morning in sympathy with equities that are down overnight following disappointing earnings from Microsoft and Meta."
In the HY primary, no issues were priced.
The average IG bond spread was unchanged at 84bp on Wednesday for the third consecutive market session and the HY bond spread narrowed by 5bp to 280bp, according to ICE BofA data. US yields across asset classes were mixed.
"IG index spreads were mostly unchanged in the secondary market yesterday, though tone was decidedly on the firm side," BMO said.
HIGH GRADE
The US investment-grade bond market is expected to draw at least four fresh offerings.
After yesterday's slate of mostly Single A-rated offerings, today's deals are coming from the riskier segment of the corporate bond market. All four of today's deals are rated Triple B.
Building materials company Martin Marietta Materials is marketing a two-part senior unsecured bond comprising 10 and 30-year maturities.
Utility Edison International is issuing a seven-year senior note at Treasuries plus 130bp area. Meanwhile, the financing subsidiary of carmaker Ford is looking to land a seven-year senior unsecured bond, with leads setting IPTs for the SEC-registered transaction at Treasuries plus 205bp area.
Health insurer Horizon Mutual is making its debut in the investment-grade market today, bringing a 10-year senior unsecured note offering.
LEVERAGE/HIGH YIELD
The pace of issuance in the US junk bond primary is picking up a touch on Thursday as borrowers raise funding before any possible upsets caused by the presidential election and the FOMC meeting next week.
Great Canadian Gaming is readying pricing today on a US$400m five-year non-call two secured bond after releasing talk of 8.75% area.
The company, which operates gaming and entertainment facilities in Canada, is using proceeds to redeem its 4.875% senior secured due 2026 and repay borrowings under a term loan B.
OneMain Financial is also looking to raise US$500m today through the issuance of a 4.5-year senior unsecured bond. The financial services firm will use proceed for general corporate purposes, including debt refinancing.
STRUCTURED FINANCE
Market participants will keep the supply flow moving today, with at least six asset-backed deals for sale by the end of the week.
Among the biggest ABS deals left on the docket are a US$850m music royalty securitization from Blackstone's Hipgnosis and a US$783.9m consumer loan issue from fintech firm Pagaya.
Another notable offering is the US$500m solar debut from Tesla, which has been a regular securitizer of its auto leases.
The remaining supply will add to the over US$6bn of asset-backed issuance that has landed since Monday, IFR data show.
As for the CMBS sector, there are three conduit issues, totaling over US$2bn, set for pricing by Friday. They will join the seven single-asset single-borrower deals so far this week, which combined raised more than US$3bn.
LATAM
Yesterday, S&P downgraded Brazilian airline Azul to CC from CCC+ on a debt exchange announcement, giving it a negative outlook.
Fitch assigned Instituto de Fomento de Hipotecas Aseguradas a first-time rating of BB with a stable outlook yesterday. The rating of the Guatemala mortgage insurance company "reflects the State of Guatemala's ability and willingness to provide the company with support to meet its obligations, if necessary," the ratings agency said.
EQUITIES
Bankers picked up the pace in US ECM late Wednesday now that the third-quarter earnings season is well-advanced, freeing many equity issuers to come to market.
Just a few days after reporting a return to growth in the past quarter, Camping World secured US$300m late Wednesday from an overnight stock sale.
After an earlier wall-cross, Goldman Sachs and JP Morgan priced an all-primary offering of 14.6m shares at US$20.50. The offering priced inside the US$20-$21 marketing range and at a 9.8% discount to Wednesday’s closing price of US$22.73.
On Monday, the Marc Lemonis-led RV seller announced a 29% jump in same-store unit sales, Camping World’s best quarterly performance in more than two years.
Camping World is using the money for general corporate purposes, including for working capital and to cut debt.
CareTrust REIT raised an upsized US$441.6m from an overnight stock sale that will fully fund skilled nursing acquisitions.
Wells Fargo, Bank of America, JP Morgan, BMO Capital Markets and KeyBanc Capital Markets priced 13.8m shares at US$32, the middle of the US$31.50-$32.50 marketing range and a 2.5% discount to Wednesday's closing price of US$32.81.
Investor demand supported an upsize from 11.5m shares at launch.
Reporting earlier this week, the healthcare REIT revealed plans to buy a portfolio of nursing homes in Tennessee for US$500m with a joint venture partner.
Elsewhere, key backers of Harmony Biosciences sold US$248m of their shares in an all-secondary follow-on stock sale.
Enovix also secured US$100m from an overnight stock sale after the lithium-ion battery maker burnt through a similar amount of cash this year.
Applied Digital raised an upsized US$375m late Wednesday from the sale of a six-year convertible bond, a transaction that is highly structured and designed to eliminate market risk.
Goldman Sachs, Cantor and JP Morgan priced the CB at a 2.75% coupon and 32.5% conversion premium. The offering was increased from US$300m after marketing overnight at 2.75%-3.25% and 30%-35% following an earlier wall-cross.
The bitcoin miner is using US$84m of the proceeds to buy back its own stock, including US$52.7m under a forward sale arrangement.