In 1Q22, US corporate bond issuance was down 14.5% y/y, with high-yield collapsing 68%. This took place even as HYG, along with LQD – already under sustained pressure – are clinging on to crucial support. In the first three months … Continued
US corporations continue to aggressively issue debt in the bond market. Even amidst this supply, demand remains good. Both LQD and HYG are near their record highs. Besides the Fed essentially acting as a backstop, corporate boards are probably also … Continued
Foreigners comprise an important source of buying in the US sovereign and corporate bond markets. In March and April, they bought some corporate bonds but massively sold off Treasury notes and bonds. The vacuum was filled by the Fed, whose … Continued
Following futures positions of non-commercials are as of April 14, 2020. 10-year note: Currently net short 70.8k, up 9.8k. The Fed is on a mission to provide a backstop to a whole host of assets. Here is its report card … Continued
In less than a month, major U.S. stock indices have witnessed phenomenal rallies. This would be a lot healthier if risk-on metrics rallied right along. U.S. stocks have rallied massively off of last month’s lows. From the March 23rd bottom … Continued
Before large-caps were sold early May, traders were already gravitating toward risk-off. Stocks have rallied the past couple of sessions, but there are still no signs of full-on risk-on. Eight sessions ago, on May 6, the Russell 2000 small cap … Continued
Continued contraction in corporate issuance of high-yield bonds is likely creating a supply-demand imbalance, helping the likes of HYG. Eight months in, 2018 corporate debt issuance continues to shrink. August saw issuance of $98.6 billion, made up of $83.4 billion … Continued
US small-caps are outperforming. Price action is great. But large-caps are not on the same page. And high-yield corporate bonds have diverged with small-caps for a while now. In early 2016 when US stocks reached a major low, several other … Continued
U.S. corporate debt issuance continued to decelerate in February. High-yield spreads are not pointing to stress in the system. After January’s $133.7 billion, February issuance slowed down to $84.3 billion. As a result, the first two-month total, comprised of $184 … Continued
With less than a month to go this year, momentum in U.S. corporate bond issuance continues. High-yield in particular is worth paying attention to. November saw issuance of $125.3 billion, made up of $97.2 billion in investment-grade and $28.1 billion … Continued