Companies around the world are increasingly turning to debt markets to fund artificial intelligence (AI) projects and take advantage of growing private credit opportunities, driving a wave of activity in corporate bonds that set new records in 2025, and looks set to continue into 2026.
Corporate Bond Trading Hits Record Levels
Last year saw an average of $50 billion worth of corporate bonds traded each day, a new high that beat the $46 billion daily average in 2024, according to data from Crisil Coalition Greenwich. That figure covers both investment-grade and high-yield debt, reflecting a surge in market activity driven by heavy borrowing and active secondary trading.
Traders say two main forces are behind the record volumes:
- AI-related borrowing: Many companies are issuing bonds to finance large AI infrastructure investments, such as data centers, which creates new debt that investors then trade in the secondary market.
- Private credit expansion: Growth in private credit markets, where institutions provide direct loans or private bonds, has expanded the pool of corporate debt and encouraged more trading activity as investors look for liquidity.
Morgan Stanley and JPMorgan Chase expect high-grade US corporate bond issuance to hit record levels in 2026, as firms continue to tap debt markets for AI-related projects and other strategic spending.
Convertible Bonds Surge to 24-Year High
Strong demand for financing tied to AI has also pushed sales of convertible bonds — debt that can be converted into equity, to their most active level in over two decades. Bloomberg reports that companies raised around $166.5 billion in convertible bond deals in 2025, the most since 2001, as issuers seek cheaper ways to fund growth and innovation.
Major technology firms, including names such as Alibaba, Lumentum, and Super Micro Computer, have tapped these convertible markets to support AI expansion, helping to fuel this spike in issuance.
What’s Driving the Trend
Market participants point to several key drivers behind the corporate debt boom and elevated trading volumes:
- Capital-intensive AI deployment: Building and scaling AI infrastructure, especially data centres and advanced computing facilities, requires large amounts of upfront capital. This leads companies to issue long-term debt to cover these costs, which then fuels secondary trading as investors adjust portfolios.
- Private credit growth: As private credit becomes a larger share of corporate financing, more debt is being created outside traditional bank lending, expanding the supply of bonds and creating new trading opportunities.
- Active trading strategies: New trading methods, including electronic execution, portfolio trading, and high-speed strategies, have made bond markets more dynamic and accessible, helping narrow price spreads and encourage participation.
Market Outlook
With AI spending expected to remain high and private credit markets continuing to grow, analysts see corporate bond trading staying elevated in 2026. Some Wall Street firms even project record levels of investment-grade debt issuance this year as companies refinance old obligations and fund next-generation technology projects.
The result is a corporate debt market that not only supports technological expansion but is increasingly central to overall credit market activity, shaping investor strategies in both public and private fixed-income arenas.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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