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Bond Market News
LV Sands, Bombardier and others Price $ Bonds
May 5, 2026
US Treasury yields jumped higher across the curve by 6-7bp on the back of a resurfacing of geopolitical tensions. Reports noted that US and Iran exchanged fire, with Saudi Arabia stepping in to deescalate tensions. Brent crude continued to hover around $114/bbl.
Looking at US equity markets, the S&P and Nasdaq dropped by 0.4% and 0.2% respectively. US IG CDS spreads were 0.8bp wider and HY CDS spreads were 5.6bp wider. European equity indices ended lower. European CDS markets were closed. Asian equity markets have opened weaker this morning. Asia ex-Japan CDS spreads were 1bp tighter.
New Bond Issues
Las Vegas Sands raised $1bn via a two-trancher. It raised $500mn via a 5Y bond at a yield of 5.349%, 30bp inside initial guidance of T+155bp area. It also raised $500mn via a 7Y bond at a yield of 5.672%, 30bp inside initial guidance of T+170bp area. The senior unsecured notes are rated Baa2/BBB-/BBB. Proceeds will be used to redeem its outstanding 3.5% 2026s and any accrued interest, alongside transaction-related fees and expenses, and for general corporate purposes.
Bombardier raised $500mn via an 8.5NC3 bond at a yield of 5.875% vs. initial guidance of 5.875-6.00% area. The senior unsecured note is rated Ba3/BB-. Proceeds, together with cash on hand, will be used to fund the redemption of its existing 7.5% 2029s.
Morgan Stanley Bank raised $3bn via a two-part deal. It raised $2.5bn via a 4NC3 bond at a yield of 4.788%, 25bp inside initial guidance of T+105bp area. It also raised $500mn via a 4NC3 FRN at SOFR+98bp vs. initial guidance of SOFR equivalent. The senior bank notes are rated Aa3/A+/AA-. Proceeds will be used for general corporate purposes.
Constellation Brands raised $500mn via a 5Y bond at a yield of 4.863%, 29bp inside initial guidance of T+105bp area. The senior unsecured note is rated Baa2/BBB. Proceeds will be used to redeem all of its outstanding 3.7% 2026s prior to maturity and for general corporate purposes.
Delek Logistics raised $800mn via an 8NC3 bond at a yield of 6.875%, inline with initial guidance. The senior unsecured note is rated B2/BB-/B+. Proceeds will be used to repurchase all of its outstanding 7.125% 2028s, redeem a portion of its existing 8.625% 2029s, and any remaining proceeds for general corporate purposes.
Otis Worldwide raised $700mn via a 3Y bond at a yield of 4.488%, 25bp inside initial guidance of T+75bp area. The senior unsecured note is rated Baa1/BBB. Proceeds will be used to fund the repayment of its 0.318% 2026s, with the remainder for repayment of commercial paper borrowings and for other general corporate purposes.
Broadridge raised $500mn via a 10Y bond at a yield of 5.79%, 30bp inside initial guidance of T+165bp area. The senior unsecured note is rated Baa2/BBB/BBB+. Proceeds will be used to repay its existing 2026s.
Ares Capital raised $800mn via a long 3Y bond at a yield of 5.761%, 28bp inside initial guidance of T+205bp area. The senior unsecured note is rated Baa2/BBB/BBB. The note has a change of control put at 100 and also a make whole call.
Rating Changes
- Fitch Downgrades Crown Castle’s IDR to ‘BBB’; Outlook Stable
- Fitch Places Prudential Financial on Rating Watch Negative
- Bermuda Outlook Revised To Positive On Strengthened Public Finances; ‘A+/A-1’ Ratings Affirmed
- Sodexo S.A. Outlook Revised To Negative On Expected Weaker Earnings And Increased Leverage; ‘BBB+’ Rating Affirmed
New Bonds Pipeline
- City of Buenos Aires launches investor calls
- Bank of East Asia $ 6NC5 loss-absorbing notes
- NAB A$ 5Y FRN and/or 15NC10 note
Term of the Day: Make Whole Call (MWC)
A Make Whole Call (MWC) is a type of call option on a bond that gives the issuer the right to redeem a bond before its maturity date by compensating (making whole) bondholders for future coupon payments. MWC provisions were introduced in the 1990s and are rarely exercised by issuers. If exercised, the issuer has to pay a lump sum amount to the bondholders that represent the net present value of future foregone coupon payments, typically stated as a formula in the bond prospectus.
MWCs are different from traditional call options in that investors are compensated for foregoing future coupon payments. With traditional call options, the issuer can exercise the call option at the predefined call price without having to pay bondholders for foregoing future coupons. This makes MWCs beneficial to bondholders as compared to traditional call options and are typically expensive for the issuer to exercise.
Talking Heads
On Backing Powell Staying On After ‘Merciless’ Attacks on Fed – William Dudley, Fmr NY Fed President
“Powell thinks that by staying on at the Fed, that’s going to actually bolster the Fed’s, the perception of the Fed’s independence. I think it makes sense for him to stay on if he’s willing to do so.”…
On ECB Rate Hike in June Is ‘All But Inevitable’ – Peter Kazimir, ECB Governing Council Member
“On this basis, policy tightening in June is all but inevitable… becoming increasingly likely that we must prepare for a prolonged period of broad-based price increases coupled with visibly weaker growth across the euro zone.”
On Private Credit Could Spark Psychological Contagion – Michael Barr, Fed Governor
“People might look at private credit, and instead of saying ‘this is an idiosyncratic problem, these were high risk loans, the rest of the corporate sector is different. Wow, there seem to be cracks in our corporate sector. Maybe over here in the corporate bond market, there are also cracks.”
Top Gainers and Losers- 05-May-26*
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