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Bond Market News
Risk-off Hits Markets, UST Yields Rise
March 27, 2026
US Treasury yields jumped higher across the curve, rising by 6-7bp. On the geopolitical front, US President Donald Trump noted that he is “pausing the period of energy plant destruction by 10 days”, adding that talks were ongoing. The OECD said that it expects US inflation to rise by 4.2% in 2026 from 2.6% last year. It also sharply increased its inflation forecasts for major economies and now sees the average inflation rate for the G-20 jumping to 4% this year. Brent Crude jumped higher to trade at over $107/bbl. Initial jobless claims for the prior week rose by 210k, inline with expectations. Separately, the US Treasury’s 7Y note auction witnessed soft demand, with a bid-to-cover ratio of 2.4x, adding to a string of weak auctions this week.
Looking at US equity markets, the S&P and Nasdaq ended lower by 1.7% and 2.4% respectively. US IG CDS spreads widened by 2.6bp and HY CDS spreads were 13bp wider. European equity indices ended lower too. The iTraxx Main CDS spreads were 3.5bp wider while the Crossover CDS spreads were 20bp wider. Asian equity markets have opened mixed this morning. Asia ex-Japan CDS spreads widened by 3.6bp.
New Bond Issues
Macquarie Bank raised $1.25bn via a two-part deal. It raised $500mn via a 3Y bond at a yield of 4.529%, ~27.5bp inside initial guidance of T+80/85bp area. It raised $750mn via a 3Y FRN at SOFR+76bp vs. initial guidance of SOFR equivalent area. The senior unsecured notes are rated Aa2/A+/A+. Proceeds will be used for general corporate purposes.
Coca-Cola HBC raised a combined €2.1bn via a three-part offering:
- €700mn via a 2.5Y bond at a yield of 3.458%, ~30.5bp inside initial guidance of MS+80/85bp area.
- €600mn via a 4.5Y bond at a yield of 3.71%, 30bp inside initial guidance of MS+105bp area.
- €800mn via a 7.5Y bond at a yield of 4.012%, 33bp inside initial guidance of MS+130bp area.
The senior unsecured notes are rated Baa1/BBB+. Proceeds will be used for general corporate purposes, including financing the acquisition of Coca-Cola Beverages Africa.
New Bonds Pipeline
- KOMIR $ 5Y/5Y FRN bonds
Rating Changes
- United States Steel Corp. Subsidiary Big River Steel LLC’s Debt Rating Raised To ‘BBB-‘; Off CreditWatch
- Moody’s Ratings upgrades FE Credit’s rating to Ba3 from B1; outlook stable
- Moody’s Ratings affirms ratings of QatarEnergy LNG S(3) with stable outlook; downgrades the Baseline Credit Assessment to baa2
- Fitch Downgrades Whirlpool’s IDR to ‘BB’; Outlook Negative
- Fitch Places Arada on Rating Watch Negative
- Albemarle Corp. ‘BBB-‘ Ratings Affirmed On Improved Balance Sheet; Outlook Revised To Positive From Negative
- Fitch Revises FMC’s Outlook to Negative; Affirms IDR at ‘BB+’
Term of the Day: Rising Star
Rising stars are companies that have recently seen credit rating upgrades that pull its rating to investment grade category from its previous junk or high yield category. They are termed as rising stars as their financial and/or operational metrics show an improving trend. The opposite of rising stars are fallen angels, which are issuers that have been recently downgraded to junk category from its previous investment grade rating category.
Seagate Technologies was recently upgraded to BBB- from BB+ by Fitch, making it a rising star.
Talking Heads
On Funding Markets Showing Dash for Cash
Mark Cabana, BofA
“It’s worth watching to see if there are signs of greater credit concerns. We’re seeing things that, if sustained, will become more worrisome — but for now it seems fine… seeing investors becoming a bit more cautious given all the uncertainty”
On Europe Bond Market Doubts Growing Over Recovery From War Rout
Laurence Mutkin, BMO Capital Markets
“There are plenty of reasons to expect bond yields to stay in higher ranges from now on and possibly re-test the upside… considerable merit in the counter-argument to the consensus view that bonds must be cheap at present levels”
Nicolas Forest, Candarim
“We will continue to see a risk premium on the oil price putting pressure on the inflation dynamic”
On Singapore Bonds Show Resilience as Iran War Roils Regional Peers
Ming Cheong, Eastspring Investments
“Any tightening will result in a stronger SGD, potentially attracting increased capital inflows. Greater capital inflows increase system liquidity, which depresses short-end rates and steepens the yield curve.”
Citigroup Strategists
“The overall bias is still for a steeper curve”
Top Gainers and Losers- 27-Mar-26*
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