Global bond sales reached a record $6.61 trillion this year, up 15% from 2023, driven by a historic borrowing surge from AI-focused tech giants. Cloud-computing and data-center firms alone issued nearly $368 billion in debt — more than six times last year's volume — accounting for about a third of the total increase. Amazon.com Inc. vaulted to the world's fourth-largest issuer, trailing only Germany, the EU, and Italy, while Alphabet Inc. ranks as the second-largest corporate borrower. Five of the top 10 U.S. corporate issuers are now technology firms, displacing financial institutions to their lowest share in a decade.
JPMorgan's John Servidea called it a "fundamental reordering" of the biggest global market, citing a new secular AI theme. Bloomberg Intelligence projects hyperscalers and neocloud firms will invest almost $4.5 trillion over three years on AI infrastructure.
However, investors have grown wary. Data-center developers now offer yields up to 7.2% on investment-grade and 10% on junk bonds. CoreWeave Inc. bonds sold off sharply on debt concerns, and credit-default swap costs for blue chips like Meta Platforms Inc. and Oracle Corp. have surged. Rising Treasury yields, geopolitical tensions, and IMF chief Kristalina Georgieva's call for a "prudently hawkish bias" add further pressure.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing