Companies rushed to sell nearly $6 billion of bonds Monday as rosy economic data and a calmer stock market in the U.S. more than offset concerns about political flare-ups in the Middle East.

Giant steelmaker ArcelorMittal (MT) led the day's $5.75 billion high-grade bond supply with a $3 billion, three-part issue; software and wireless specialist Juniper Networks Inc. (JNPR) brought its inaugural sale in three parts for a combined $1 billion; and John Deere Capital Corp. sold $750 million, increased from a planned $350 million. Also on tap was a $1 billion sale from financial services firm BB&T Corp. (BBT).

Emboldening these issuers were positive readings out of Chicago purchasing managers, strong personal-income data and the recent rally in government bonds to which corporate debt is benchmarked.

While risk premiums on company debt--the extra yield they must pay relative to safer federal government debt--has risen over the last two weeks, the yield on Treasurys have fallen, lowering the benchmark rate for corporate borrowers. The 10-year Treasury yield, which moves inversely to its price, fell to 3.407% Monday from 3.741% as of Feb. 8.

"Supply was going to start picking up last week" but was probably shelved in some cases due to market volatility, said John Bender, head of U.S. fixed income at Legal & General Investment Management America, which participated in the ArcelorMittal and Juniper deals. The strong start to this week is probably a case of "people bringing their issues forward with the rally in rates," he added.

March is traditionally a busy month for corporate issuance--with February lagging due to restrictions around corporate earnings disclosures--and Bender said he expects to see $100 billion to $125 billion of high-grade sales alone next month. Last week, only $6.5 billion of high-grade bonds were, according to data provider Dealogic.

Since earnings blackouts are behind them and commodity prices are marching higher, many companies have been looking to raise capital while the backdrop for issuance is still reasonably supportive.

"People have seen over the last few years that a liquidity drain in a crisis can shut down the market for a month or two at a time," said Bender, referring to a potential loss of buyer interest amid unrest in the Middle East.

ArcelorMittal offered a rate of 1.70 percentage points over Treasurys on $500 million of five-year bonds; 2.15 percentage points over Treasurys for $1.5 billion of 10-year bonds; and a spread of 2.30 percentage points over Treasurys for $1 billion of 30-year bonds, according to people familiar with the deal when it launched Monday afternoon. The company said in a regulatory filing it plans to use the proceeds for general corporate purposes, including to refinance a loan maturing November 30.

Juniper Networks priced $300 million of five-year bonds to yield 3.137%, 1 percentage point over Treasurys; $300 million of 10-year bonds to yield 4.616%, or 1.20 percentage point over comparable Treasurys; and $400 million of 30-year bonds to yield 5.953%, a spread of 1.45 percentage points, people familiar with the deal said.

The bonds received investment-grade ratings: Baa2 from Moody's Investors Service, and BBB from Standard & Poor's, which said the rating reflected the company's "positive operating performance and moderate financial policies." A representative at the Sunnyvale, Calif., issuer declined to comment.

John Deere Capital Corp., the equipment-financing unit of farming machinery maker Deere & Co. (DE), priced $500 million of fixed-rate debt to yield 1.164%, or 0.47 percentage point over Treasurys, and $250 million floating-rate debt at a spread of 0.22 percentage point over the three-month London Interbank Offered Rate, a benchmark rate reflecting what banks charge to lend to each other.

BB&T priced $1 billion of five-year bonds to yield 3.23%, or 1.10 percentage point over Treasurys.

Representatives of Deere and BB&T did not immediately respond to requests for comment.

-By Katy Burne, Dow Jones Newswires; 212-416-3084; katy.burne@dowjones.com
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