How a stock-market selloff made junk bonds an unlikely safe haven

Inflation scares haven’t created havoc everywhere.

This chart shows a steadier rise for high yield since May 2020, while the S&P 500 index gains have been choppier. In other words, it’s hard to see a catalyst for the sky to fall for junk bonds JNK, +0.30% HYG, +0.32%, without an unexpected shift in the Federal Reserve’s accommodative policy stance, of another outside shock.

Stocks have shot up during the pandemic as trillions of dollars worth of fiscal and monetary stimulus have been unleashed to help shore up financial markets, companies and households. Corporate bond yields, and spreads, have plunged too.Bond spreads are the level of compensation investors earn above a risk-free benchmark like U.S. Treasuries. Lower spreads imply investors are willing to be paid less to finance companies and other borrowers, even those considered a high default risk.

horrible

Nigeria Nigeria Latest News, Nigeria Nigeria Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

European stocks rise as rebound continues, while mining stocks react to fall in commodity pricesEuropean equities rose on Friday, as the rebound continues from a selloff caused by inflation fears, with mining stocks being the major drag on stock-market... Do you think this is what people really need right now? .markets .markets Ushiba $Ushiba WallStreet 'advisers' and mass media: CNBC, Bloomberg have to be very proud for luring clueless retail 'investors' into the biggest StockMarket BUBBLE in history! This is what they are paid for by big corporations - turning retail investors into bagholders!
Source: MarketWatch - 🏆 3. / 97 Read more »

Treasury yields steady as U.S. stocks seen risingU.S. Treasury yields edge higher Tuesday, with appetite for bonds cooling as stocks appears to catch a bid, dimming some of the support for long-term bonds. Where can you go for fun in your city?
Source: MarketWatch - 🏆 3. / 97 Read more »