JPM High-Yield and Leveraged Loan Morning Intelligence

Research evidence excerpt

JPM High-Yield and Leveraged Loan Morning Intelligence

aking at $235bn in

2021, Global PC Fund raising totals $132bn YTD after setting a low since 2019 last year ($173bn).

--Overnight Price Action: S&P Futures are down 15bp overnight with Tech stocks lagging despite strong

earnings from a major Taiwanese chipmaker (link). Meanwhile, Brent is stable at $85 and 10yr Treasury

yields climb 3bp ahead of today’s US Retail Sales, initial claims, and Philly Fed at 8:30am, NAHB Survey

and pending home sales at 10am, 3 Fed speakers, and Trump’s primetime address at 9pm. Yesterday’s PPI

surprised to the downside, and together with a softer CPI, eased inflationary fears and remove the

possibility of a Fed hike in July. Notably, OIS Forwards are currently pricing in one hike by year-end

compared to 1.5 hikes at the start of the week. With only 35 S&P co. reporting for 2Q, EPS growth

(+58.6% y/y vs +28.8% 1Q) and revenue trends (+16.1% vs +11.7% 1Q) are ahead of consensus (+22%

EPS, +12% Sales).

This Morning’s Headlines and Highlights

--TSMC Hikes Sales, Spending Outlook to Catch AI ‘Megatrend’; BBG

--Iran-US Skirmishes Worsen as Hormuz Shipping Traffic Dwindles; BBG

--Market Is So Risk-On That Path Higher Looks Tough; BBG

--Uber launches $15 billion bid for Delivery Hero to create global takeout giant; Rtrs

--Goldman’s Bell Sees More Gains for Europe’s AI Buildout Stocks; BBG

--South Korea to Halt New Listings of Single Stock Leveraged ETFs; BBG

--U.S. to Impose 25% Tariff on Certain Goods From Brazil; WSJ

--Flows & Liquidity: The need for deleveraging; Panigirtzoglou

--High-Yield and Leveraged Loan Market Brief: High-yield bond prices rose by the most in a month on

Wednesday (+$0.12 d/d, +0.16% d/d HYG) alongside oscillating stocks (+0.4%) and a 4bp slide in 10yr