High yield bond nolume hits $6.75B as energy issuers return to market

High yield bond issuance in the U.S. totaled $6.75 billion this week, which was interrupted by a widely populated leveraged finance conference courtesy J.P. Morgan. With the recent activity, year-to-date high yield issuance totals $53 billion, more than 20% ahead of volume seen at this point in 2014.

Interestingly, much of the week’s activity is via a sector that brought the high yield market to a halt during the fourth quarter. Energy and energy servicer names, including Comstock Resources, Sabine Pass Liquefaction, and MarkWest Energy Partners, are approaching the market as issuers take note of a drop in Treasury yields this week and more than a month of strong inflows of retail investor cash into U.S high yield funds, according to LCD’s Joy Ferguson. Indeed, U.S. high yield bond funds saw another $1.1 billion net inflow of retail investor cash during the week, the fifth straight period of at least $1 billion in inflows.

That healthier tone is evident in yields, which have slipped to 5.75% as of yesterday from 5.94% a week ago, according to the S&P U.S. Issued High Yield Corporate Bond Index (SPUSCHY). Those numbers are a yield-to-worst.

As for deals, Cheniere Energy Partners, via issuer entity Sabine Pass, made the biggest splash this week with an offering originally planned for $1 billion, but which was doubled in size due to a market that was especially accommodating to the issue’s near-investment grade rating of BB+/Baa3, as well as the deal’s hi grade-style par call three months prior to maturity, according to LCD’s Matt Fuller.

http://www.forbes.com/sites/spleverage/2015/02/27/high-yield-bond-volume-hits-6-75b-as-energy-issuers-return-to-market/?ss=energy