Interview, Fireside Chat
How Companies Are Accessing Capital in an Uncertain Environment
- Short-term markets are currently prioritized by the speaker and their clients, with the Fed's secondary paper purchase program expected to significantly impact the secondary market.
- A spillover effect into the primary market is anticipated as investors liquidate secondary positions to create capacity for primary purchases, while the Fed's dealer commercial paper program is expected to become operational within the last number of days.
- Market conditions are forecasted to improve over the next number of days and weeks as the aforementioned Fed programs take effect.
- The longer-term credit market, which closed due to the US health crisis, reopened last week with significant volume following a volatile start on Monday where only a high-rated Procter & Gamble deal was finalized.
- Activity continued to expand on Tuesday and into the current day, with new transactions announced for lower-rated issuers such as Humana, indicating broader market functionality.
- Access to public markets is expected to improve for investment grade issuers through a new Fed program purchasing four-year corporate bonds at market-based rates, complementing similar European Central Bank initiatives for the euro market.