Corporate bond yields spike as coronavirus-induced fears grip investors

The 10-year bond yields closed at 6.38 per cent

The corporate bond yields have shot up, widening the spread between them and government bonds, as investors shun the companies fearing defaults due to coronavirus-induced slowdown.
 
“Locally bond markets had already become very discerning due to the NBFC crisis. So the main issuance was dominated by public sector units (PSUs) or stronger credits. Rolling over and refinancing will certainly become more difficult, especially as credit spreads have widened,” said Gaurav Kapur, chief economist of IndusInd Bank.
 
The spread between equivalent maturity government bonds and corporate bonds have also widened considerably in this period. The spread for AAA and