Congress returns to session this week with sequester cuts as the top priority, and the focus of the market’s attention as we wind down the Q4 earning season. Fed chairman Bernanke will be speaking on Tuesday and Wednesday in front of the House and Senate on monetary policy, which could cause some market movement as everyone is digesting the possible implications of a less accommodative Fed after last week’s minutes were released. The J.P. Morgan high yield conference gets underway today in Florida, which is being blamed for the light volume to start the week. The underlying tone in high yield remains strong after the sell-off of two weeks ago, and despite money continuing to trickle out of the two index focused ETFs, though the pace has certainly slowed. The new issue market is also starting the week off on the slow side, with only one deal announced and expected to price this afternoon. Equities are modestly better this morning, the HY19 high yield credit index is unchanged and high yield cash bonds are flat to slightly better on thin volume.
Although information and analysis contained herein has been obtained from sources Peritus I Asset Management, LLC believes to be reliable, its accuracy and completeness cannot be guaranteed. This report is for informational purposes only. Any recommendation made in this report may not be suitable for all investors. As with all investments, investing in high yield corporate bonds and loans and other fixed income, equity, and fund securities involves various risks and uncertainties, as well as the potential for loss. High yield bonds are lower rated bonds and involve a greater degree of risk versus investment grade bonds in return for the higher yield potential. As such, securities rated below investment grade generally entail greater credit, market, issuer, and liquidity risk than investment grade securities. Interest rate risk may also occur when interest rates rise. Past performance is not an indication or guarantee of future results. The index returns and other statistics are provided for purposes of comparison and information, however an investment cannot be made in an index.