Morgan Stanley(US:MS)2025-06-04 01:50Investment Rating - The report does not explicitly provide an investment rating for the global credit market Core Insights - US Investment Grade (IG) spreads tightened by 3 basis points (bp) last week, resulting in an excess return of 32 bp, with inflows of $1.9 billion for the week and a year-to-date (YTD) total of $12.6 billion [2] - US High Yield (HY) spreads tightened by 16 bp, leading to an excess return of 39 bp, with inflows of $0.2 billion for the week and a YTD total of $2.7 billion [3] - US Leveraged Loans saw spreads tighten by 2 bp, yielding a total return of 22 bp, with inflows of $0.3 billion for the week and a YTD total of $2.5 billion [4] - EU Investment Grade spreads tightened by 4 bp, resulting in an excess return of 23 bp, with net inflows of €2.1 billion for the week and €19.1 billion YTD [5] - EU High Yield spreads tightened by 17 bp, translating into an excess return of 50 bp, with net inflows of €606 million for the week and €0.6 billion YTD [6] - Asia Credit spreads tightened by 2 bp, with IG spreads tightening by 3 bp and HY spreads widening by 6 bp [7] Summary by Sections Global Credit Snapshot - US IG current spread is 88 bp, with a 1-year change of 32% and a 12-month change of 2 bp [12] - EU IG current spread is 100 bp, with a 1-year change of 34% and a 12-month change of -8 bp [12] - Asia IG current spread is 78 bp, with a 1-year change of 27% and a 12-month change of 0 bp [12] Performance Across Asset Classes - US IG funds saw inflows of $1.9 billion, with YTD issuance reaching $866 billion, a 7.4% increase year-over-year [2] - US HY funds experienced inflows of $0.2 billion, with YTD supply tracking at $106 billion, a 26% decrease year-over-year [3] - EU IG funds had net inflows of €2.1 billion, with YTD volumes at €356 billion, a 7% increase year-over-year [5] - EU HY funds saw net inflows of €606 million, with YTD supply at €56 billion, a 13% decrease year-over-year [6] Credit Demand and Supply - Weekly supply for US IG reached $24 billion, raising YTD issuance to $866 billion [2] - Weekly supply for US HY was $5 billion, with YTD supply at $106 billion [3] - Weekly supply for EU IG was €12 billion, lifting YTD volumes to €356 billion [5] - Weekly supply for EU HY was €1 billion, with YTD supply tracking at €56 billion [6] Sector Performance - In US IG, media, telecoms, and retail sectors delivered the best performance, while basic industry, automotive, and services lagged [2] - In US HY, transportation, technology, and real estate sectors delivered the highest excess returns, while banking, telecoms, and insurance lagged [3] - In EU IG, leisure, automotive, and insurance sectors outperformed, while services, utility, and transportation lagged [5] - In EU HY, single B rated bonds outperformed [6]