Other issuers came into the bond markets, including Dow Chemical and FirstEnergy. For those looking to raise debt capital, this is the time to do it. As long as mutual fund flows into fixed income funds continue, credit markets are open for business.
Investment grade CDS (see chart below), amazingly enough, has tightened to pre-Lehman levels.
This of course is starting to make market participants really nervous. We've been here before. From Reuters:
U.S. corporate bonds, after rallying nearly nonstop since March, may be poised for a pullback before year end.But few, however, want to short into this rally - it's hard to stop a freight train.
"I don't think at this point in time there's a lot of reward for the risk you are taking in the corporate bond market in any sector," said Dan Vrabac, portfolio manager for the Ivy Global Bond Fund in Overland Park, Kansas.