Investment grade struggles while high yield strengthens.
Global asset markets had a wild ride at the beginning of last week as political turmoil roiled Italy's sovereign bond market.
The corporate bond market couldn't maintain momentum in the face of interest-rate increases and new issue supply.
Higher oil prices have bolstered corporate bonds in the energy sector, especially among the lower-rated issuers.
High-yield fund flows seesaw between inflows and outflows.
Volatility dwindled over the course of the week, trading action felt light, and new issue activity was muted.
Although the stock market eked out a gain last week, the S&P 500 is muddling along near the middle of its year-to-date trading range.
Investors tiptoe back into high yield.
It appears that corporate bond investors are becoming more comfortable undertaking credit risk at these levels.