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U.S. companies flooded the investment-grade market with at least $8 billion of new bonds Monday, taking advantage of low interest rates, high investor demand and generally robust earnings.

A dozen borrowers said they were preparing debt offerings Monday, building on a week in which high-grade companies sold $19.9 billion worth of bonds, according to data provider Dealogic.

"We have pent-up supply that was limited by earnings season blackout periods, and that's coming through," said Guy LeBas, chief fixed-income strategist at Janney Capital Markets in Philadelphia.

LeBas added that borrowers are encouraged by a market rally in the face of last week's heavy issuance: the CDX IG15 index of investment-grade bonds fell 7 basis points. The benchmark index measures the cost of insuring a basket of U.S. investment-grade corporate debt against default, and so a drop in the index suggests greater confidence and higher prices in the bond market.

Additionally, LeBas noted this is a holiday-shortened week which will liklely compress issuance into Monday and Tuesday. The U.S. bond market will close Thursday in observance of Veterans Day.

Corporate borrowers are also hustling to complete financing before mutual funds close their books for the end of the year, which many start to do a month or more before the end of the calendar year to allow for audits and the preparation of financial reports.

Considering those factors and others--including the Federal Reserve's plans to reduce interest rates in a bid to stimulate the economy and signs of a rebound in the job market in October--there seems to be no clear advantage in waiting to sell bonds, said Larry Glazer, managing partner at Mayflower Advisors LLC in Boston.

"You don't issue when you need to, but rather when buyers need your debt," Glazer said. "You don't buy a car when you want one, but when the dealer needs to sell you one."

United Parcel Service Inc. was first up on Monday, with a benchmark-sized two-part offering of senior unsecured notes. PPG Industries Inc. Becton Dickinson & Co. and the Kentucky Utilities unit of PPL Corp. followed suit. All plan to sell at least $1 billion of debt.

Borrowers are not confined to one industry, and ratings range from high-A to triple-B. Coca-Cola Enterprises Inc. Ventas Realty LP, a unit of Ventas Inc. Hubbell Inc. and AutoZone Inc. along with several others are also priming deals for sale.

Still, favorable conditions won't last forever.

Companies are pushing hard to sell their bonds before renewed concerns about European government debt levels roil markets again, according to Scott MacDonald, head of credit and economic research at Aladdin Capital Management. Risk premiums on 10-year Greek bonds traded at more than 9 full percentage points over German government bonds last week.

"Technical factors are still key to this market," MacDonald said.
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