(Bloomberg) — Apple Inc. and General Motors Co. had to pay up on bonds they sold on Monday, a sign investors are demanding more to hold debt from companies under pressure from President Donald Trump’s tariff offensive.
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Both companies had to pay relatively high yields compared with their existing securities to convince investors to buy the new debt. In the case of Apple, it paid 0.05 percentage point, or 5 basis points, more on its new debt. GM paid as much as 18 basis points more, according to data compiled by Bloomberg News.
Those premiums, known as the new issue concessions, were high relative to the average for companies this year of about 3.8 basis points. There were other signs of demand being relatively modest for the two companies’ bonds, including the orders for notes relative to the amount of securities for sale.
Investors placed orders for 1.9 times as many three-year Apple notes as were for sale, and about 2.6 times as many for the 10-year securities. The average coverage levels for issuers this year is 3.6 times, according to Bloomberg News data.
Apple, the maker of iPhones, issued $4.5 billion of investment-grade debt in four parts, according to a person familiar with the matter. While demand was by some measures was comparatively low, by other metrics the company did well: the deal’s longest part, for example, a 10-year note, priced with a yield of 50 basis points above Treasuries. For Apple’s last sale in 2023, that spread was 80 basis points.
GM sold $2 billion of notes, meanwhile, with the longest portion, a 10-year note, yielding 1.95 percentage point over Treasuries, a person with knowledge of the transaction said.
The two companies have supply chains that extend globally. Both posted results last week, and cautioned that their bottom lines would see an impact from escalating trade wars. Apple on Thursday warned that tariffs will increase costs by about $900 million this quarter. GM cut its full-year profit outlook last week, just days after initially suspending its earnings guidance for 2025.
A spokesperson for GM declined to comment. A representative for Apple wasn’t immediately available to comment.
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Both deals were the first for the respective holding companies in at least two years. Apple last issued in 2023 and GM the year prior to that, although GM’s financing arm is a frequent seller of bonds.