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An $8 billion debt deal from the world’s largest oil company, Saudi Aramco, has pushed developing nations’ bond issuance beyond previous full-year volumes. Governments and companies have raised more than $692 billion in dollar and euro bonds so far this year, beating the previous record of $678 billion raised in 2017, according to data compiled by Bloomberg.

Refinitiv data shows entire yield curves in Germany, the Netherlands and Finland once again below zero, meaning investors must pay those governments to hold their debt. What was seen in 2014 as a temporary side effect of unorthodox monetary policy, now seems firmly entrenched, given a growing belief that central bank stimulus will be in place long after a vaccine against the coronavirus is rolled out - source: cyprus-mail.com, Refinitiv 

With US Treasury yields capped around 0.90% amid concerns that in the absence of fiscal stimulus the Fed will need to step in with more easing, China is facing a different set of challenges and following the recent rout in the bond market following several unprecedented State Owned Enterprises (SOE) defaults, overnight the Chinese 10Y yield rose another 2bps to 3.36%, and almost 90bps from the all time low of 2.48% hit in April. As a result, the premium for China’s 10-year government bonds over U.S. Treasuries of same duration has climbed to 250 basis points, the highest on record.  Source: www.zerohedge.com  

"China Yield is not only relatively attractive from a comparative valuation perspective, but its size is hue, particularly for the higher beta portion of the market. Replacing the market yield and index weight of China elsewhere within the Emerging Market Corporate realm is a daunting task to say the least. The greater one underweights China, the larger the number of wide-ranging, idiosyncratic bets one is forced to take. In Asian Credit, the high beta alternatives are often challenged/distressed names in India or Indonesia. This also makes Chinese HY a potentially super-crowded trade going into 2021" - source: Todd Schubert - Bank of Singapore.

The share of global negative-yielding debt has increased. Chart is % of market cap outstanding (source: Goldman Sachs)