Credit Market Analysis
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Credit Market Analysis > Latest Notes
Corporate bond market QE – please no!
QE 'fix' unwelcome... The corporate bond market is anything but broken. Issuers are easily funding at or close to their lowest ever levels. Investors are hugely receptive of deals - across the ratings spectrum, and by a large margin. Demand for new corporate debt is holding at oversubscriptions typically in the 3x - 7x area. In IG non-financials, the annual run rate is close [...]
Here comes the summer sun…
Markets play it cool... Equities in the US into record territory, rates giving up some of their stellar gains and IG credit spreads at levels not seen since May 2018. A dovish Fed has laid the foundations for a rate cut at the end of month FOMC meeting, and the ECB looks as if they will also cut the deposit rate and/or announce a new QE programme. Equities will get a further [...]
Liquidity aplenty, but expensive to hold
... and greater risks emerging Until the late pull back when markets were undermined by the minutiae of the timing of any Fed rate cut, it was looking fantastic. Actually, we don't think it changes much and it is looking very good still. We're in the midst of the mightiest bond grabfest in history. We have record low bond yields. Corporate funding costs are collapsing. The S [...]
Keeping the faith... The euphoria of the month's opening session hit a brick wall, leaving us with what could best be described as a more reflective day for the most part. Hopes and positive soundbites driving markets higher were replaced by the need for something more concrete to emerge from any US-Sino talks. Markets were treading water. Macro is in need of a boost and hel [...]