Glencore’s debt and equity plunged on Monday on the back of a damning analyst note. The 30% one-day stock fall and 400bp spike in credit default swaps were largely clawed back by the end of the week as the company worked all-out to calm nervous investors. But the magnitude of the moves compared with those of peers facing similar headwinds left market participants scrambling for alternative explanations for the extreme volatility.
BHP Billiton was trying to distance itself from last week’s Glencore sell-off as it attempted to issue US$4bn–$5bn of hybrid debt. The Anglo-Australian mining, metals and petroleum company is planning a multi-currency debut hybrid to shore up its balance sheet and fund potential M&A.
Lenders remain supportive of embattled commodities trader and mining company Glencore, which has about US$13bn of liquidity available and can finance its debt maturities for two years.
The US investment-grade bond market completed the first nine months of 2015 on a high – at least in terms of issuance levels – with volumes surpassing the US$1trn mark, according to IFR data.
The US corporate bond market has gone from bad to worse, and if bears are right that a repricing of risk is at hand, there could be even more trouble ahead.
China’s top policy bank narrowly avoided disaster on a two-tranche bond issue last week, but the weak response from investors raised new questions over Beijing’s ability to push more of the country’s funding requirements to the international markets.
Bumi Resources looks set to become the first Asian company to complete a bond restructuring this year, after a Singapore court pushed the Indonesian coal miner into action.
German IPOs have roared back into life after a relatively fallow period at just the wrong moment. Deals that looked to be robust and easy a few weeks ago are stuttering against a difficult backdrop.