HENKEL AND SANOFI SET NEW MILESTONE WITH NEGATIVE YIELDING BONDS
Deals show how QE has upended market assumptions
A fresh milestone in the world of negative interest rates was reached on Tuesday, when Henkel and Sanofi became the first public companies to sell new euro bonds to investors for more than the buyers will get back.
The sales are the latest sign of how European Central Bank policies to suppress borrowing costs for governments and companies have upended assumptions about the way financial markets operate.
German consumer goods group Henkel sold €500m of two-year debt with a yield-to-maturity of minus 0.05 per cent, while French pharmaceutical business Sanofi sold €1bn of three-and-a-half year debt, also at a yield of minus 0.05 per cent.