Primary market activity returned with a vengeance on Tuesday, making 2009 the second-highest on record for euro bond supply, boosted by a host of investment-grade companies including Pfizer and ArcelorMittal. High-grade euro-denominated bond supply has surpassed 165 billion euros ($231 billion) and is now just 35 billion off the 200 billion euros record set in 2001, with seven months of the year remaining, according to Societe Generale data.
French industrial gases group Air Liquide raised 400 million euros via a six-year bond, Deutsche Telekom announced plans for a 500 million euro bond while ArcelorMittal was set to raise 2.5 billion euros via a four-year and seven-year bond. US pharmaceutical giant Pfizer beat all of those with a $10.6 billion four-part bond, denominated in euros and sterling, that will help finance its purchase of Wyeth.
It was just short of the record $14 billion raised in the euro and sterling market by sector rival Roche in February to finance its acquisition of Genentech. In the broader market, European credit derivative indexes recouped earlier losses to tighten after US stocks opened higher on the back of better-than-expected consumer confidence data.
By 1457 GMT, the investment-grade Markit iTraxx Europe index was slightly tighter at 124.5 basis points, according to data from Markit. The Markit iTraxx Crossover index, made up of 45 mostly "junk"-rated credits, was at 752 basis points, 3 basis points tighter.
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