Heard on the Street: Fears about corporate debt are rising, but high-yield bonds should prove resilient https://t.co/Evj6NHiLuo ...

>> FROM NEW YORK CITY FOR OUR VIEWERS WORLDWIDE, I AM MATT ALONGSIDE EMILY GRAFFEO. "BLOOMBERG REAL YIELD" STARTS RIGHT NOW. COMING UP, SLUGGISH ECONOMIC DATA COMBINED WITH SURGING ENERGY COSTS PUTS PRESSURE ON THE FED'S DUAL MANDATE.PRIVATE CREDIT FLASHES WARNING SIGNS. WHEN THE OTHER HAND, PUBLIC CREDITS THESE MONSTER BOND SALES FROM AMAZON, DRIVING THE SECOND-BUSIEST WEEK EVER. HOW THE IRAN WAR AFFECTS THE GLOBAL ECONOMY.>> JUST BECAUSE THE PRESIDENT SAID IT MIGHT BE A SHORTER TERM CONFLICT DOES NOT MEAN ...

BlackRock's Rick Rieder said he’s reducing exposure to US investment-grade and high-yield bonds while increasing holdings of emerging-market debt, citing favorable valuations and a soft dollar https://t.co/0NcWYaqKRa ...

Federal Reserve Policy & Inflation - The Fed faces pressure regarding its future policy path, with potential easing trajectory influenced by dovish FOMC members [1][2] - Inflation remains above the Fed's 2% target, with PCE stabilizing but still not at the desired level [2][3][4] - The market anticipates a potential rate cut in September, with odds around 88%, but the pace of future cuts depends on labor market data and inflation [11][12][13] - The Fed's dual mandate of managing inflation and promoting employment creates a conflict, requiring a measured approach to rate cuts [15][16] - Maintaining market confidence and the Fed's credibility in fighting inflation is crucial [17] Treasury & Bond Market - Treasury auctions for 2, 5, and 7-year notes fell just shy of $100 billion, with sales expected to increase [18] - Attractive yield levels are enticing investors, balancing against tight credit spreads [21] - High-yield bonds offer competitive returns compared to equity markets, with strong fundamentals and contained default rates [23] - Shorter-duration, off-the-run credit space presents value with potentially higher yields (8%-9%) and good fundamentals [28] - Institutional concerns around the Fed and fiscal policy are keeping long-end yields elevated [32] Credit Market & Risk - Concerns exist about credit spreads remaining tight despite relatively high default rates, potentially masking underlying issues [19][20] - The high-yield market's risk-adjusted return may not compensate for potential margin compression and downgrades [26] - Public credit markets may be benefiting from weaker credits staying in private markets [31] - The market anticipates U S payrolls report [36]