Rakuten’s Default Swaps Signal Lower Risk on Issuance Plan (1)

The cost to insure Rakuten Group Inc. debt against default fell and its shares gained after the Japanese e-commerce company said it’s planning to issue up to ¥100 billion ($665 million) of corporate bond-type shares to strengthen its financial position.

Rakuten’s credit-default swaps were indicated lower at about 290 basis points on Wednesday, a trader said. The CDS dropped 34 basis points to 332 basis points late Tuesday, the lowest level since September 2022, CMA data show. The company’s shares gained as much as 1.7%, while Japan’s two main stock indexes declined.

Credit markets have been signaling some of the ...