J.P. Morgan Market Watch

Research evidence excerpt

J.P. Morgan Market Watch

Dubravko Lakos-Bujas (1-212) 622-3601 Nikolaos Panigirtzoglou (44-20) 7134-7815 Global Markets Strategy J P M O R G A Ndubravko.lakos-bujas@jpmorgan.com nikolaos.panigirtzoglou@jpmorgan.com

J.P. Morgan Securities LLC 24 July 2026

Fabio Bassi (44-20) 7134-1989 Mika Inkinen (44-20) 7742 6565

fabio.bassi@jpmorgan.com mika.j.inkinen@jpmorgan.com

J.P. Morgan Market Watch record-low 9.9%. Top sector weights were Energy, Financials,

and Tech (2Q26 High Yield Fund Analysis, Jul 22nd).

Bonds

Liquidity surged, but the gains were heavily concentrated

In the US, yields rose week-over-week as already pervasive in higher‑grade credit, implying breadth improvements are

speculation around next week’s FOMC meeting intensified now incremental as portfolio/algorithmic trading becomes

following the ECB’s hawkish hold on Thursday, further sup- “plumbing.” HG activity rose far more than riskier markets:

ported by a downside surprise in initial jobless claims and aggregate trading +28% YoY in HG vs +5% in HY and -3%

steady continuing claims (pre-requisites for hikes). The move in Loans/CLOs, mirrored in ETFs (+34% HG vs +4% HY)

was led by the belly (+13-15bp WoW) followed by the front- and CDX (+41% IG vs +10% HY). AI, hyperscalers, and pri-

end (+7-15bp WoW). Against the backdrop of rising com- vate credit shifted where trading occurs, with Technology and

modity prices amid renewed tensions in the Middle East and Media leading turnover in both HG and HY; AA-and-higher

a persistently more hawkish Fed, we saw 1y1y OIS reach its turnover grew 40% and long-end turnover grew +10% on

highest level in nearly two years, as money markets price in hyperscaler flows (US Credit Market Liquidity: 1H26

the odds of a hike next week at nearly 1/3. We remain cau- Update, Jul 23rd).