U.S. Company Credit Swaps Hold; Pfizer Sells $4 Billion in Bonds
By Victoria Stilwell - May 28, 2013 4:56 PM ET
A gauge of U.S. corporate credit risk was little changed as Pfizer Inc. sold $4 billion in bonds, its first debt offering since 2009.
The Markit CDX North American Investment Grade Index, a credit-default swaps benchmark that investors use to hedge against losses or to speculate on creditworthiness, dropped 0.3 basis point to a mid-price of 75.5 basis points at 4:11 p.m. in New York, according to prices compiled by Bloomberg.
Accommodative Federal Reserve policy in addition to signs of an improving economy may alleviate investor concern that companies will struggle to repay their debts. Consumer confidence is linked to spending, so gains in sentiment may signal that the recovery is gaining traction, according to Matthew Duch, a fund manager at Calvert Investments Inc. in Bethesda, Maryland.
“The Fed definitely wants to increase consumer spending,” Duch said in a telephone interview. “If the consumer feels good, that means gross domestic product growth and the economy are on better footing.”
The Markit CDX North American Investment Grade Index, a credit-default swaps benchmark that investors use to hedge against losses or to speculate on creditworthiness, dropped 0.3 basis point to a mid-price of 75.5 basis points at 4:11 p.m. in New York, according to prices compiled by Bloomberg.
May 28 (Bloomberg) -- Rick Rieder, chief investment officer for fundamental fixed income at BlackRock Inc., talks about investment strategy, central bank monetary policies and the outlook for the U.S. economy. Rieder speaks with Erik Schatzker, Sara Eisen, Scarlet Fu and Hans Nichols on Bloomberg Television’s “Market Makers.” (Source: Bloomberg)
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“The Fed definitely wants to increase consumer spending,” Duch said in a telephone interview. “If the consumer feels good, that means gross domestic product growth and the economy are on better footing.”
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