Customers walk past an Apple logo inside of an Apple store at Grand Central Station in New York, U.S., August 1, 2018. REUTERS/Lucas Jackson
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As U.S. tax cuts prompt Apple Inc. and other tech companies to bring home their overseas cash hoards, it's leaving a void in the market for short-term corporate bonds, where those firms had invested much of the money. That's now making it more expensive for other companies to borrow.Once the biggest buyers of short-dated corporate debt, Apple along with 20 other cash-rich companies including Microsoft Corp. and Oracle Corp. have turned into sellers.For a company that relies on such debt to fund its operations, it's the equivalent of $4.15 million in extra interest costs each year for every $500 million of debt issued.With the tech companies likely to bring home more cash through year-end, the market pains will only get worse, said Richard Saperstein, managing director at HighTower Advisors's Treasury Partners.Apple alone held more than $150 billion in corporates, exceeding some of the world's biggest debt funds.
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