Enthusiasm for the high-yield rally waned over the past week as issuers flooded the market with new deals ahead of this week’s Fed decision, while retail mutual and exchange traded funds reported the largest outflows of the year, equities lost ground and oil plunged to a 10-week low. The yield-to-worst/spread on the Bank of America High-Yield Index (BAML) widened 38bps/29 bps on the week quickly moving from 18-month lows to several month wides of 6.01%/+389bps.
|10-Mar Yield/Level||Weekly Return/Change||MTD Return/Change||YTD Return/Change|
|BAML Spread||389 bps||29 bps||15 bps||-32 bps|
|10yr treasury||2.58%||10 bps||18 bps||13 bps|
US retail mutual and exchange traded funds reported an outflow of $2.1 billion for the week ended March 8th, the largest weekly outflow from the asset class since the week ended Nov 16th of $2.3 billion. This was the second consecutive week of outflows totaling just over $2.4 billion for the span. Year-to-date the market has seen outflows totaling $743 million. The issuance onslaught in high-yield land was relentless this week with 26 deals pricing for $17.55 billion in proceeds making it the busiest week of issuance on record, surpassing the previous record of $16.46 billion in September 2013.