Credit’s Strong Run Stumbles for First Time This Year

 

• ‘Valuations aren’t attractive,’ says Allspring’s Noah Wise
• But Goldman expects excess returns through end of year

Global corporate bond spreads are on track to turn in their first month of weakening since late last year, reigniting the debate about the relative value of credit versus other fixed-income classes heading into the second half of 2024.

Spreads on corporate bonds including junk and investment-grade notes have widened by about 10 basis points so far in June, from around the lowest levels seen in three years, a Bloomberg index shows. Meanwhile, yield premiums on those notes as well as US high-grade bonds are rising from levels touched in May which have only been seen for less than 1% of the period since the 2008 global financial crisis, the data shows.

https://www.bloomberg.com/news/articles/2024-06-22/credit-s-strong-run-stumbles-in-first-this-year-credit-weekly