High-yield rallied again Thursday with the yield to worst on the Bank of America High Yield Index closing at 8.73% vs 8.78% and the spread closing at +728bps vs +731bps the previous day as global markets continued to gain ground. US high-yield funds recorded a record inflow into mutual and exchange traded funds for the week ending 3/2 of $4.97 billion, beating out the previous record of $4.25 billion for the week ending Oct 26^th 2011. This was the third consecutive positive reading for an inflow of $7.77 billion over the span. This morning we’re opening up higher again as equities rally after this morning’s US Payrolls report showed a surge, rising 242K vs a median estimate of 195K. The jobless rate held at 4.9%; however, average hourly earnings dropped, the first monthly decline in more than a year. Overnight, global equities moved higher as emerging markets extended their best week since last October. Commodities also continue to rally, with copper up to its highest level in nearly four months and gold extending its rally into its first bull market since 2013. We beleive market backdrop remains supportive of the high-yield market and the path of least resistance continues to be higher.  One deal is expected to price this afternoon for GameStop.

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.