HYLD News and Press, High Yield From 04/26/22

With U.S. bond market yields rising to levels not seen since 2018–19, market participants appear to be debating whether rates have further room to rise from here or whether the increases now represent a renewed buying opportunity to go long duration. The rise in UST yields thus...

The invasion of Ukraine is an inflationary shock to an already inflationary system. The International Energy Agency has warned that the impact on oil supply will peak only from May onwards. Since the war broke out, core government bonds have suffered sustained price declines unsee...

When reviewing the current state of the global economy and investment markets, we recommend focusing on market signals and weeding out market noise. While decelerating from the pace of 2021, U.S. economic growth is expected to remain positive in 2022, pending further unexpected inflat...

It looks like the war will last quite a bit longer than investors originally expected. This causes problems for our inflation situation, which ironically may mean a more aggressive Fed interest rate policy. The Fed may not be able to do anything about supply chain issues, but it sure ...

If China were to continue to pursue a Zero Covid policy amidst rising case counts, supply chains originating in Asia could get shut down again. On the food front, wheat is particularly vulnerable to a prolonged conflict, which has been reflected in the performance of wheat futures. ...

Many market pundits have advocated a strategy of “buying the dip” after significant selloffs, but does it always make sense to do so? Our analysis of asset performance following geopolitical events, alongside a deteriorating macro context, lead us to prefer a nimble and ...

Global growth uncertainty has accelerated, while inflation appears likely to persist. Still, we anticipate neither recession nor stagnation; moreover, central bank tightening expectations have likely peaked, potentially normalizing interest rate volatility and supporting spread sector...

As investors continue to digest the likely path of this tightening cycle, we think the dramatic moves of recent weeks are set to ease, laying a good foundation for credit investors. We now expect the Fed to hike rates by 50 basis points in both May and June, followed by a sequence of ...

The 10-year Treasury yield spiked to 2.72% on Friday, the highest since the February-December 2018 era. High Grade AA-rated corporate bond yields have been rising too, but since mid-March more slowly than the equivalent Treasury yield. Junk bond yields actually fell over the past ...

Recent events have just added an additional inflationary impulse into an already high-inflation environment. Europe is somewhat elevated relative to the past but well below what we see in the US. So really, from an investor’s standpoint, this high-yield opportunity in credi...