The high-yield rally stalled yesterday as oil and equities retreated and safe haven securities like gold and treasuries moved higher on the day. The yield and spread on the Bank of America High Yield Index held steady at 9.42% and +810bps. Fund flows remained positive Tuesday totaling $577 across passive and active mutual and exchange traded funds, the largest single day inflow YTD. This morning we’re opening lower by ¼ of a point generically as oil and equity futures move lower as hopes of a production freeze loses momentum on Saudi comments and an industry report shows US inventories at record highs. Much of the high-yield trading volume remains credit specific as the market continues to sift through corporate earnings, while energy bonds are bought or sold depending on the direction of oil on a daily basis. One new issue priced Tuesday for Summit Materials, bringing its new $250 million Caa2 deal at 8.5%, wide of initial price talk and breaking for trading below issue which we have not seen much of this year.

The Bank of America Merrill Lynch High Yield Index monitors the performance of below investment grade U.S. dollar-denominated corporate bonds publicly issued in the U.S. domestic market.  Index data sourced from Bloomberg. Yield referenced is the yield-to-worst and spread referenced is the spread-to-worst.