Global debt capital markets activity falls 9%
Overall global debt capital markets activity totaled US$3.6 trillion during the first half of 2018, a 9% decrease compared to the first half of 2017 and the slowest opening six-month period for global debt capital markets activity since 2015. Second quarter global debt activity decreased 11% compared to the first quarter of this year.
US investment grade corporate debt falls to five-year low
High grade corporate debt offerings targeted to the US marketplace totaled US$671.1 billion during the first half of 2018, a 9% decrease compared to 2017. Despite gains in the Retail, Consumer Staples, Energy and Industrials sectors, the first half of 2018 marks the first year-over-year decline for the asset class since 2010.
Global high yield down 24%
The volume of global high yield corporate debt reached US$171.6 billion during the first half of 2018, a decline of 24% compared to the first half of 2017 and the slowest first half for global high yield issuance in two years. United States high yield issuers accounted for 46% of the quarterly total, down from 55% a year ago. China and the United Kingdom accounted for 9% and 7%, respectively. High yield offerings from Financial issuers accounted for 27% of first half activity, up from 15% during the first half of 2017.
Retail offerings nearly double; tech, media & telecom lead decliners
Bolstered by multi- billion bond offerings from CVS Health, Walmart, Dollar Tree and Starbucks, DCM activity from Retail issuers totaled US$81.7 billion during the first half of 2018, registering an industry-leading increase of 98% compared to year-ago levels. Technology, Media and Telecom activity saw the steepest year-over-year declines, registering a combined decrease of 47%. Financials and Government & Agency issuers accounted for 71% of global debt offerings during the first half of 2018, on par with a year ago.
Emerging markets corporate debt down 24%
Corporate debt from emerging markets issuers totaled US$136.1 billion during the first half of 2018, down 24% compared to last year. Corporate debt issuers from India, Mexico, Russia and Brazil accounted for 42% of first half 2018 activity. Issuance from corporations in Mexico totaled US$16.0 billion, up 19% compared to levels seen during the first half of 2017.
Citi tops global debt league table
Citi narrowly maintained the top spot for global debt underwriting during the first half of 2018 with proceeds of US$219.3 billion and 6.1% share of the market. JP Morgan took second place with a market share decline of 0.4 points, while Bank of America Merrill Lynch maintained third place, with 5.1% of the market.
Overall debt underwriting fees decrease 12%
According to estimates, underwriting fees from DCM activity totaled US$13.8 billion during the first half of 2018, a decrease of 12% year-on-year.