MS AI Debt Financing Tracker Summer Spreads Turned Wider

M August 20, 2026 09:03 PM GMT

Global Credit Strategy & Securitized Products Morgan Stanley & Co. LLC Global Idea

Fernanda Lima Research Strategist

AI Debt Financing Tracker: The Carolyn L Campbell Strategist

Summer Spreads Turned Wider Vishwanath Tirupattur Strategist

Vishwas Patkar HQ Hyperscalers are ~30bp wider YTD, yet supply has not Strategist slowed, with $54bn done in July and $41bn in August (MTD). James Egan Strategist Even with ~$445bn of issuance across credit channels YTD, we

expect a busy fall and continued spread widening. In addition to Morgan Stanley & Co. International plc+

public market supply, HQ issuers will continue to flex their Aron Becker Strategist ratings muscles to provide credit support to others as new

financing structures emerge. Collateral-backed & stabilized Morgan Stanley & Co. LLC

assets have better risk-reward than unsecured corporates. Catherine Liu Strategist

Key Takeaways Morgan Stanley & Co. International plc+

We saw ~$92bn of AI-related new issuance in corporate credit globally since July, Vasundhara Goel Strategist which reinforces our view that market capacity remains ample, but price sensitivity and the consequences to issuance vary across the credit spectrum. Morgan Stanley Asia Limited+ Wider spreads – especially for HQ borrowers – are the natural release valve for Kelvin Pang corporate credit markets to continue to fund the AI capex cycle. Strategist Over $20bn of debt backed by data centers came to market in July alone, pushing Morgan Stanley & Co. LLC spreads in corporate credit – but not securitized credit – meaningfully wider as Eva C Baurmeister the market continued to reprice elevated supply expectations. A steady stream of Strategist headlines on data center development pushback and policy measures that could

slow down the pace of new assets from Texas to Ohio added to the noise on Christina C Sigler Strategist bonds with higher construction risk.

In corporate credit, we think issuance out of hyperscalers could slow in the near Morgan Stanley & Co. International plc+

term, but we would fade a move back to the tights given 2027 capex estimates (~ Jonathan Loke Strategist $1.4tr). We also expect high-quality names to leverage their AAA/AA ratings and

provide credit support to the AI-ecosystem and facilitate access to capital to Ellie Dann lower-quality/unrated /private companies that are more sensitive to higher costs Strategist of capital.

In securitized credit, spreads held flat, largely shrugging off the selloff in credit. Morgan Stanley does and seeks to do business with Issuance continues at a steady pace, though less strong than credit at ~65% of companies covered in Morgan Stanley Research. As a result, FY25 volumes. The stabilized nature of the assets backing ABS/CMBS insulates investors should be aware that the firm may have a conflict of interest that could affect the objectivity of Morgan Stanley them from some of the risks causing volatility in corporate credit. That said, we Research. Investors should consider Morgan Stanley Research as only a single factor in making their investment think risks skew to the downside from here and expect to see spreads soften in decision. the fall once supply resumes. For analyst certification and other important disclosures, refer to the Disclosure Section, located at the end of this While elevated supply and wider spreads have been largely top of mind, clients report. seem increasingly focused on the financing structures themselves particularly += Analysts employed by non-U.S. affiliates are not registered with FINRA, may not be associated persons of the member given the recent NVDA financing platform announcement. We expect HQ credit and may not be subject to FINRA restrictions on support to play a bigger role in private capital engagement in the ongoing AI communications with a subject company, public appearances and trading securities held by a research analyst account. infrastructure buildout, especially as capex shifts from powered shells to components like chips/servers.

Morgan Stanley India Company Private Limited+ We're changing our publication format and expanding our content. For detailed Yagyesh Modi Strategist issuance…