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European companies are tapping bond markets again as investors return

November 23, 2022 00:00:00

LONDON, Nov 22 (Reuters): European companies are again looking to sell bonds after months of turbulence in world markets as investors warm up to riskier debt, offering the final opportunity to raise money before the year ends.

Surging inflation, rapid interest rate hikes and a darkening economic outlook have weighed on bond sales from Europe's top-rated corporate issuers.

Yet tentative signs are emerging that supply and investor appetite are picking up, especially as signals that inflation might be peaking bring some stability to volatile markets.

German housing giant Vonovia last week raised 1.5 billion euros ($1.54 billion) amid strong investor demand in primary markets, a bright spark for a beleaguered property sector.

"If we concentrate on the past couple of weeks, now this is a good entry point," said Giulio Baratta, head of investment grade finance at Debt Capital Markets, EMEA at BNP Paribas. "Vonovia, for instance, came at a decent yield and the fact that it is a lead player (meant) the deal was successful without much question around the real estate sector."

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