High yield debt is a mixed bag today as Draghi’s hawkish comments have fueled a rise in European government bond yields. The US 10- and 30-year yield has crept up today too, while the rest of the curve is flat. Yellen is out making comments on the value of assets, thus causing some volatility. Three high yield new-issues priced yesterday for $1.25B bringing the weekly total to $3.5B. Seven deals are on the books for this week with an estimated $2.9B. Outflows continue for floating rate loan retail products (mutual and exchange traded funds) and it is expected that we will see a negative flow for bonds in the trailing week that Lipper will report tomorrow. With oil stabilizing we are seeing a more positive market, but the talk is now turning to higher rates despite what the economic reports are telling us, or maybe these bankers just want to remain relevant, because world GDP growth doesn’t match their rhetoric.
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