The massive debt issuance by US technology companies is causing a ripple effect in the credit market, which seems to have unexpectedly boosted the risk indicators of some of the safest companies in the world. A strategist at BNP Paribas said that these changes are a collateral effect of increased capital competition in high-rated markets. Big tech companies are raising billions of dollars in financing, and this competition for capital is even driving up the cost of credit default swaps for businesses unrelated to data centers or artificial intelligence. BNP Paribas did not disclose the specific companies involved in the analysis. However, data shows that since the end of last year, the swap spreads for companies such as luxury goods giant LVMH, pharmaceutical company Sanofi, and defense company BAE Systems Plc have all increased by more than 10%.

The massive debt issuance by US technology companies is causing a ripple effect in the credit market, which seems to have unexpectedly boosted the risk indicators of some of the safest companies in the world. A strategist at BNP Paribas said that these changes are a collateral effect of increased capital competition in high-rated markets. Big tech companies are raising billions of dollars in financing, and this competition for capital is even driving up the cost of credit default swaps for businesses unrelated to data centers or artificial intelligence. BNP Paribas did not disclose the specific companies involved in the analysis. However, data shows that since the end of last year, the swap spreads of companies such as luxury goods giant LVMH, pharmaceutical company Sanofi, and defense company BAE Systems Plc have all increased by more than 10%.