U.S. companies are looking to set a third straight record month for bond issuance, with Apple Inc. and Avis Budget Group Inc. among the first out of the gates Monday.

Apple brought an US$8.5 billion sale after skipping its forecast for the first time in more than a decade, while rental car company Avis is seeking to raise US$400 million. The tech giant was one of 10 investment-grade borrowers selling bonds Monday, in what some see as the start of another record month for supply.

Companies have been borrowing at a rampant pace to shore up cash during the pandemic, with global lockdowns still largely in effect. Many are tapping the bond markets right after reporting earnings, where it’s become the norm to scrap financial estimates for the rest of the year.

The first real wave of issuance got underway in March when the Federal Reserve said it would buy U.S. corporate bonds. It wasn’t until today that the central bank outlined its plans to purchase the securities in the coming days, but it will start with eligible exchange-traded funds first.

Today’s investment-grade deals were “simply a continuation of extremely strong supply we saw in April as companies bolster their balance sheets,” said Steven Oh, global global head of credit at Pinebridge Investments LP. “That supply is meeting robust demand from investors, which is additionally buoyed by forthcoming Fed as buyer.”

Joining Apple in the high-grade market was Oneok Inc., a midstream oil and gas company that’s rated one step above junk at Moody’s Investors Service. It’s refinancing debt with US$1.5 billion of new bonds due in five, 10 and 30 years. The shortest portion will yield 5.5 percentage points above Treasuries, a level in line with high-yield rated borrowers.

And speaking of high yield, which just had its busiest month for issuance in three years, Kraft Heinz tapped in that market for the first time since becoming a fallen angel in February, when it lost its investment-grade ratings. It’s raising US$2 billion of notes, with some of them at yields around 4.25% and under -- less than those of Oneok. Kraft Heinz also announced a tender offer to buy back up to US$1.2 billion of bonds due in the next three years.

In Europe, credit risk climbed and new bond sales slowed amid mounting economic gloom and fresh tensions between the world’s two largest economies. U.S. President Donald Trump said he has little doubt that China misled the world about the scale and risk of the coronavirus.


Avis is seeking to borrow US$400 million of senior secured notes, confirming an earlier report by Bloomberg. Apple was in with a four-part offering -- it last borrowed in the dollar market in September.

Starbucks was also in the market, and one of the latest companies to be downgraded in the middle of a bond sale. Fitch cut it one notch to BBB with a negative outlook after initial price talk was announced
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BDCs, the most visible part of the US$800 billion private-credit market, are set to give an early look this week into how the asset class is faring amid the Covid-19 pandemic
Direct lender Owl Rock is looking to raise US$1.5 billion to lend to small and mid-sized companies facing liquidity issues amid the pandemic, according to people familiar with the matter


A Bloomberg News survey of market participants carried out before the weekend had forecast at least 30 billion euros (US$33 billion) of issuance in the region this week.

Primary market issuance was limited to offerings from two German states while GlaxoSmithKline Plc brought the only corporate deal, including its first sterling bonds since 2012
Consultants at EY said more than a fifth of listed U.K. companies issued a profit warning in the first quarter of 2020, well above the 17% seen in the whole of 2008
Norwegian Air Shuttle ASA shareholders agreed a restructuring plan that will qualify the struggling carrier for state aid and keep it afloat in the coming months. More than 10 billion kroner (US$957 million) of debt will be converted to equity, wiping out current shareholders
Air France-KLM won EU approval for a French government subordinated shareholder loan and guarantee, the European Commission said
Spain’s Telefonica SA confirmed it’s in talks with Liberty Global Plc to create the U.K.’s largest telecom operator. It follows an El Confidencial report that the company is to revise down its earnings forecast


Indonesian contractor Hutama Karya was the sole Asia issuer to market dollar bonds on Monday as the cost of insuring debt against default in the region rose amid risk-off sentiment.

The Markit iTraxx Asia ex-Japan index of credit-default swaps increased around 4 basis points to about 120.4 and the most in a week

--With assistance from Kyungji Cho, Rick Green, Paula Seligson, Gowri Gurumurthy, Kelsey Butler and Jack Pitcher.