APAC Credit Roundup: Weekly Review: Week ended July 10

Research evidence excerpt

APAC Credit Roundup: Weekly Review: Week ended July 10

ccounted for 80% of last week’s

supply, driven by three deals: one corporate, one quasi-corporate, and one financial issuer.

On the high-yield side, there was only one corporate issuer. We expect supply to remain active

this week, with several issuers from India and Korea potentially looking to tap the market.

But activity should quiet down next week as we ente the mid-summer months.

US HG – Spreads drifted wider with yields back at the highest

since mid-May

JULI spreads widened by 2bp to 90bp on the week. The higher all-in yields from the renewed

Middle East tumult have brought the index yields back to 5.63%, the highest since mid-May.

Last week’s supply totaled $51bn, as hyperscalers issuance filled what had traditionally been

a very quiet period, allowing supply and demand to rebalance ahead of bank issuance in the

second half of July. Demand remains healthy, with IG funds attracting a solid $10.5bn of

inflows this week (-17% w/w), benefiting from quarter-end rebalance flows. With an

additional $24.2bn of Amazon debt entering the index this month, AMZN will become the

largest non-financial issuer, with a market value of $108bn (1.2% of the index). The broader

2Q earnings picture looks strong, with consensus expectations for another quarter of >20%

earnings growth. Arguably, the bar is relatively high going into earnings season.

Additionally, since the ceasefire was announced, BBB spreads have shown lower sensitivity

to oil prices than BB spreads. With the BB-BBB spread differential already at its tightest since

February 2025, our US HG team sees room for BBBs to outperform BBs if risk sentiment

deteriorates again.

Asia financials – Broad-based tightening amid higher US

Treasury yields