European credit markets have shortened significantly over the last three years. According to Muzinich & Co., high-yield companies have kept older, low-coupon bonds outstanding while issuing shorter-dated bonds during periods of elevated funding costs. Meanwhile, falling prices for longer-dated bonds have reduced their market share, making European corporate bond markets notably shorter than in late 2021.
Shorter duration markets are supportive of tighter spreads, the asset manager points out. “If the theme of tighter spreads were to continue in 2025 and duration-adjusted spreads reach the tights seen in 2017, we estimate this could generate around 2% of excess return in single-As and BBBs,” says Portfolio Manager Ian Horn and explains that this is calculated by multiplying the implied spread tightening Muzinich identified by current market durations.
Read the full insight here.
Read more
T. Rowe Price
Why US Treasuries may no longer be a safe haven
US Treasuries recent performance has fallen short of expectations.
Candriam
The euro bond market is back in focus
Rising yields and shifting fiscal dynamics are bringing the euro bond market back into focus.
Lombard Odier
EM equities – potential opportunities amid challenges
EM equities face renewed pressure amid US trade policy shifts, slowing growth, and investor outflows.
US Markets
100 days of Donald Trump
The first 100 days of Donald Trump’s second term have shaken markets. Asset managers weigh in on US equities, bonds, and the dollar.
