Corporate Bonds Aren’t Worried About a Trade War
IBM, Bristol-Myers and even some junk-rated borrowers rush to market and find willing buyers.
The $20 billion borrower.
Photographer: Craig Warga/Bloomberg
Even before markets opened this week, President Donald Trump set the tone with a pair of tweets that threatened additional tariffs on China and lamented that a trade deal was coming along “too slowly.” Instinctively, investors’ eyes were glued to the S&P 500 Index, watching to see whether it would tumble from its recent record levels.
The benchmark hung tough on Monday, before plunging as much as 2.4 percent on Tuesday. That, in turn, sent the Chicago Board Options Exchange Volatility Index, sometimes referred to as the market’s “fear index,” to the highest since January. “‘Fasten your seatbelt and don't hold your breath’: Wall Street scrambles to figure out what's next for stocks after Trump sends shockwaves through markets” declared a Business Insider headline, effectively capturing the type of hyperbole making the rounds.