CUSIP Request Volume Ebbs In July Signaling Moderation Of New Securities Issuance Push - Pre-Market Corporate And Municipal Bond Activity Slows In July Following Two Straight Months Of Rapid-Fire Growth

CUSIP Global Services (CGS) today announced the release of its CUSIP Issuance Trends Report for July 2017. The report, which tracks the issuance of new security identifiers as an early indicator of debt and capital markets activity, found declines in the pre-trade market for municipal and corporate issues in July. This decreased demand for new CUSIP IDs for corporate and municipal bonds is suggestive of a possible slowdown in new security issuance volume over the coming weeks.

CUSIP identifier requests for U.S. and Canadian corporate offerings totaled 4,299 in July, down 10% from June, driven by an 18% decline in corporate debt offerings. Requests for new corporate equity identifiers increased by 12% during the same period.  So far this year, demand for new CUSIPs for both corporate debt and equity offerings are still up 20% over the same period in 2016, reflecting a robust pace of new debt and equity issuance during the first half of 2017.

Municipal requests also decreased in July. A total of 1,092 muni identifier requests were made during the month, a decrease of 36% decrease from June. On a year-over-year basis, municipal request volume was down 22% through the end of July 2017, reflecting ongoing volatility in municipal issuance volumes over the course of this year.

“This pattern of consecutive months of strong growth in CUSIP request volume, punctuated by a month of more moderate activity, has been playing out repeatedly since the fourth quarter of 2016,” said Gerard Faulkner, Director of Operations for CUSIP Global Services. “On a relative historical basis, overall volumes are still very strong, but the pauses do suggest a cautiousness among market participants when it comes to bringing new securities into the marketplace.”

International debt and equity CUSIP International Numbers (CINS) volume also saw volume decreases in July.  International equity CINS decreased 25% and international debt CINS decreased 8% during the month. On a year-over-year basis, international equity requests were down 10% and international debt requests were up 66%, reflecting continued volatility in international markets.

“The on-again/off-again nature of CUSIP request volume over the past several months is indicative of the cautious[BJ1]   optimism we’re seeing reflected in market psychology,” said Richard Peterson, Senior Director, S&P Global Market Intelligence. “Market participants still see opportunities to raise new capital, but they are also dialing it back as they continue to watch the interest rate situation and overall market behavior for signs of opportunity.”

To view a copy of the full CUSIP Issuance Trends report, please click here.

Following is a breakdown of New CUSIP Identifier requests by asset class year-to-date, through July 2017: