Snapback Starts to Run Out of Steam
The Morningstar Corporate Bond Index tightened 5 basis points last week.
The snapback in the corporate bond market that began in early January has begun to run out of steam. In the investment-grade corporate bond market, the average spread of the Morningstar Corporate Bond Index tightened 5 basis points to +135. In the high-yield market, the average credit spread of the ICE BofAML High Yield Master Index widened 7 basis points to +434. Since hitting their widest levels earlier this month, investment-grade credit spreads have tightened 27 basis points and high-yield spreads have tightened 110 basis points.