Corporate Bonds
Credit-selection driven approach aiming to find value, anticipate trends, and capture rising stars within corporate bond markets.
Bringing it home: Global Corporate Bond Autumn Outlook
Fixed Income Boutique
En bref
Macroeconomic Trends
- Global growth indicators are trending lower, with a cooling U.S. labor market and the impact of tariffs affecting economic activity.
- Central banks are likely to maintain a dovish stance, with potential rate cuts expected to support economic conditions.
Corporate Fundamentals
- Investment-grade corporates are well-positioned with stable-to-improving credit metrics, higher margins, and prudent balance sheet management.
- Positive rating momentum is observed, particularly for U.S. BBB-rated bonds, though fallen angel risks are increasing.
Market Technicals
- Strong inflows into global credit funds and ETFs are a key supporting factor.
- Elevated issuance levels, particularly from U.S. firms issuing in EUR (Reverse Yankees), remain a significant trend.
Valuation Insights
- Credit spreads are tight (and may likely remain at tight levels), but yields are at multi-year highs, offering attractive opportunities.
- Dispersion among credit categories and sectors creates relative value opportunities, with long-dated bonds trading at high yield levels.
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