Quiet Week for Corporate Bond Market During Summer Slowdown
No dramatic news from Jackson Hole.
Following several large transactions priced in the new issue market earlier this month, activity slowed to a crawl last week as the summer slowdown swung into full force. Although trading activity was muted in the secondary market, corporate bonds traded with a positive tone and credit spreads either held steady or tightened slightly. The average spread of the Morningstar Corporate Bond Index (our proxy for the investment-grade bond market) ended the week unchanged at +113; the average credit spread of the BofA Merrill Lynch High Yield Master Index tightened 9 basis points to +389.