NEW YORK: For weeks, Oracle Corp’s debt has been trading like junk amid concerns that its artificial intelligence (AI) investments won’t pay off for years, if at all.
On Monday, those fears appeared to dim after the software giant garnered record demand for a US$25bil bond sale.
The shift was triggered by Oracle’s announcement on Sunday that it was raising about US$25bil of equity in addition to debt this year, reassuring investors that it wouldn’t strain its balance sheet too much as it funds big investments in data centres.
The tech firm’s bonds and stock both gained for most of the session. Some investors said that optimism following the company’s fundraising could spread to the broader credit market.
“The Oracle deal could be the all‑clear for taking risk in investment-grade corporate bonds,” said Mark Clegg, a senior fixed-income trader at Allspri
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