Junk Markets Mount a Cautious Rally for Risk After Drought

As volatility fades, investors in leveraged finance markets are ready to deploy cash, which may help spark a fresh wave of debt issuance.

After a three-week halt, issuers rushed into the junk bond market this week, including a nearly $4 billion sale for the riskiest portion of the debt financing the buyout of Citrix Systems Inc. More than $8 billion in new junk bond offerings priced in just two sessions, the busiest in almost two months, and the leveraged loan market saw five deals launch this week, including one to fund a dividend, a more aggressive use of proceeds. Investors ...