US credit markets are grinding to a halt with fund managers refusing to bankroll buyouts and investors shunning high-yield bond sales as rising interest rates and market volatility weigh on sentiment.

Not a single company has borrowed money through the $1.2tn US high-yield corporate bond market this month. If that drought persists, it would be the first month since November 2008 that not a single high-yield bond priced in the market, according to data providers Informa and Dealogic.

In the leveraged loan market, two transactions were postponed last week after Barclays, Deutsche Bank, UBS and Wells Fargo failed to find buyers for the debt packages, a rarity in what has been one of the hottest corners of credit markets this year.


"This is clearly more than year-end jitters," said Guy LeBas, a strategist at Janney Montgomery Scott. "What we're seeing now is pretty typical for end-of-credit-cycle behaviour."


As prices in the loan market have slumped over the past two months, banks that committed to finance highly leveraged buyouts earlier this year have struggled to find investors to back the deals. Some lenders, including JPMorgan Chase and Goldman Sachs, have offered loans at substantial discounts to entice investors. But others, including Barclays, Deutsche Bank, UBS and Wells Fargo, have had to pull deals altogether. 

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