Borrowing costs for high-yield issuers ease from May highs
Source: Markit, BofA US HY Index
As the market for high yield bonds briefly opened back up in June in tandem with a short-lived rally in the equity markets, pricing has in turn fallen from its recent highs. Primary market picing spiked in May, largely because of the nature of stressed issuers tapping lenders during such market tumult. The B2/B rated unsecured paper backing general corporate purposes at Carnival Corp completed at a coupon of 10.5% on 1 May, while Frontier Communication’s B3/B secured notes backing capital expenditure landed at 8.75%, raising the average.