(Bloomberg) — A slew of blue-chip firms kicked off issuance in the US investment-grade primary debt market on Thursday, as underwriters brace for what’s expected to be one of the busiest Januaries for bond sales.
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Ford Motor Co., General Motors and Credit Agricole SA are among 10 high-grade firms looking to borrow money on Thursday. Ford’s financing unit is marketing a two-part bond deal for general corporate use. General Motors’ financing unit and Credit Agricole each plan to sell bonds in three-part deals.
A majority of the issuers on Thursday are companies in the financial and utility sectors, which tend to be regular borrowers with relatively strong credit ratings. Since investors are familiar with the issuers, banks typically don’t have to spend a lot of time marketing the deals.
The borrowers on Thursday are potentially trying to get ahead of what’s poised to be a busy month of issuance. High-grade syndicate desks are expecting between $175 billion to $200 billion of bond sales for the month, versus a record $190 billion in January 2024.
Related: M&A Is Seen Supercharging Global Corporate Bond Sales Next Year
High-grade issuers could start the year with a “bang,” led by banks, Bloomberg Intelligence’s Sam Geier and Noel Hebert wrote in a note Thursday. Issuance this month could surpass the decade average of $145 billion for January, with BI seeing approximately $175 billion of issuance, give or take $5 billion.
“Strength in the banking sector, tight spreads and maturities of $100 billion could be key drivers, but the primary market could face headwinds if debt-ceiling disagreements return,” they wrote.
Other issuers tapping the high-grade market Thursday include Ares Capital Corp., Athene Global Funding, Duke Energy Carolinas LLC and Dominion Energy South Carolina Inc.
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