High-yield corporates at a virtual standstill

Rising interest rates and continuing tension surrounding the Ukraine conflict have brought the issuance of high-yield corporate bonds in Europe to a virtual standstill. “The size and speed of the current interest rate increase is causing companies to stop going public and the market to virtually dry up,” said one specialist.

Junk bonds no longer high yielding

“Due to the search for yield, a “shut up and take my money” sentiment is starting to emerge in the world of high-yield corporate bonds. Investors would be wise to be more cautious in allocating money to the high-yield markets. It is dangerous to stay in the highest-risk segment with the idea that things will go well for another six months”, according to Sander Bus, managing director and co-head of the credit team at Robeco, speaking in an interview with Fondsnieuws, Investment Officer Luxembourg’s sister publication.