CUSIP Requests Surge In February Signaling Corporate And Muni Bond Bounce - Volume Increase Follows Three Straight Months Of Waning Demand

CUSIP Global Services (CGS) today announced the release of its CUSIP Issuance Trends Report for February 2017. The report, which tracks the issuance of new security identifiers as an early indicator of debt and capital markets activity, found a notable uptick in the pre-trade market for corporate and municipal bonds in February, following three straight months of declines.

CUSIP identifier requests for U.S. and Canadian corporate debt and equity offerings totaled 2,474 in February, a 15% increase from January 2017 totals. This growth was driven largely by a surge in requests for new corporate equity and debt CUSIPs.  A total of 1,283 new domestic corporate equity CUSIPs were requested during the month, the highest level since May of 2013. Meanwhile, requests for domestic corporate debt CUSIP identifiers totaled 789 in February, the best monthly showing since November 2016. On a year-over-year basis, corporate debt and equity CUSIP requests for the U.S. and Canada were up 49.2% versus 2016 totals.

Municipal bond requests also increased in February following a three month decline.  A total of 933 muni identifier requests were made during the month, an increase of 13% over January. On a year-over-year basis, municipal bond request volume was down 14% through the end of February 2017.

“After three straight months of declining volume in requests for new corporate and municipal debt identifiers, we’ve noted a distinct tide change in February,” said Gerard Faulkner, Director of Operations for CUSIP Global Services. “Whether that shift is indicative of market sentiment in the debt markets or simply the laws of supply and demand is not yet clear; it will be important to keep watching this metric closely as market participants continue to digest a fair amount of uncertainty.”

International debt and equity CUSIP International Numbers (CINS) volume were mixed again in February.  International equity CINS held largely flat for the month, while international debt CINS increased 9% during the month. On a year-over-year basis, international equity requests were down 7% and international debt requests were up 101%, reflecting continued volatility in international markets.

“The CUSIP indicator has been suggesting a slowdown in new debt issuance throughout the period of uncertainty surrounding the transfer of power in Washington,” said Richard Peterson, Senior Director, S&P Global Market Intelligence. “While we cannot yet tell whether this month’s reversal of that trend is a signal that sentiment is changing or an anomaly, we can say we expect to see a healthy level of new security issuance in the near term.”

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 February 2017: