Middle East conflict scares away borrowers! European bond market witnessed "zero issuance"

As the Middle East conflict shakes the global market and raises credit risk indicators, European borrowers are putting their bond issuance plans on hold. On Monday, there are currently no bonds denominated in euros, pounds, or dollars being promoted in the region's public bond market. According to sources, borrowers who had planned to issue bonds have chosen to postpone the transactions. Marco Baldini, head of Barclays' global investment grade bond syndicate business, said: "We are currently in a wait-and-see mode. Given the weak market background, all decision-making meetings today regarding whether to proceed with issuance have been canceled." He was referring to the routine communication meetings held in the morning between bankers and prospective bond issuers. According to a survey conducted in the media last Thursday and Friday, bond market participants initially expected a strong start to issuance in March. At that time, all respondents predicted that this week's issuance volume would be at least 25 billion euros (29 billion US dollars), with some even expecting it to exceed 50 billion euros. However, the situation quickly changed. Over the weekend, war broke out between the US and Iran, further escalating hostilities in the Middle East. European corporate credit risk indicators saw their largest increase since last October in early trading, while global stock markets fell and oil prices surged. Traders said that Asian high-grade credit spreads widened by about 4 basis points, potentially marking the largest increase in seven months. Data shows that if there is no bond issuance today, it would be the first Monday this year without any bonds being issued. It should be noted that the debt market can usually recover quickly from shocks, and the issuance volume forecasted earlier this week suggests that there is still a large amount of issuance ready once the market stabilizes. However, Andrea Seminara, CEO of Redhedge Asset Management, said: "My biggest concern is the large supply we were expecting this month." "I wouldn't wait too long - it's better to issue slightly cheaper now than to lose 300 basis points later. I'd rather earn 10 basis points less than lose 300."