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Wed12132017

Last updateSat, 29 Jul 2017 12am

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Junk Bonds Flashing Warning Signs

3 best leading indicators for recession have been Credit Spreads, the Shape of the Yield Curve and Profit Margins.

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What if there is no rate hike?

The latest Fed Funds futures - a place to bet on future moves in rates - suggested there the probability of rate hike is less than 50% even after the Fed meeting in March next year.  It was 99% certainty at the beginning of the year.

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Junk Bond - a Haven in Global Bond Rout?

Junk bond returns are beating investment grade by the most since 2009, according to Bank of America Merrill Lynch indexes. Investors in speculative-grade notes globally earned 4.3 percent this year, while the higher-rated bonds forfeited 0.03 percent, the first loss for the period since 2008.

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It's the $3 Trillion Bond Trade Investors Should Fear!

The size of US corporate bond market has ballooned by $3.7 trillion during the past decade.  In the past, there are 23 types of investors in the bond markets.  But according to Citigroup's strategist Stephen Antczak, majority of the $3.7 trillion growth is now concentrated in the hands of 3 types of buyers:  mutual funds, foreign investors and insurance companies!

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US likely to hike interest this year

2015-05-22 (Friday) Janet Yellen said: "If the economy continues to improve as I expect, I think it will be appropriate at some point this year to take the initial step to raise the federal funds rate target and begin the process of normalising monetary policy.”  Subsequent rate rises were likely to be “gradual”, Ms Yellen added, given the headwinds that would continue to hold back growth. It would be “several years” before the federal funds rate was back to its normal, long-term level.

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