Credit Market Outlook & Strategy

Research evidence excerpt

Credit Market Outlook & Strategy

J P M O R G A N North America Credit Research

31 July 2026

Yields going hyper-bolic should be supportive for

spreads near term

• “At the end of the day, HG investors buy yields not spreads.” This old adage North America Corporate Credit -

from a much wiser strategist rang true this week as yields hit fresh new highs. Investment Grade Strategy

Long-end yields at their highest since November 2023 should be positive for Nathaniel Rosenbaum, CFA AC

spreads, in our view, just as they were last March. The only major difference (1-212) 834-2370

between now and then though is that market is now pricing in 2 hikes through nathaniel.rosenbaum@jpmorgan.com

mid-2027 and the Iran conflict is seemingly not headed towards any kind of Silvi Mantri

final resolution. So higher yields are still a positive for spreads, but the (1-212) 834-7239

magnitude seems more uncertain this time. If we see yield buyers step in silvi.mantri@jpmchase.com

J.P. Morgan Securities LLC

(domestic insurance and/or Taiwan, for example), we'd expect this to lead to

a flatter 10s30s spread curve.

• In terms of the hyperscalers, we maintain the more bullish stance we’ve argued

for the last two weeks. We’d expect somewhat of a reprieve from the onslaught

of Tech supply that has weighed on the market in July. In fact, not only was

July the second highest month for gross Tech supply ever ($49bn) but more

importantly it was the highest share ever of total monthly issuance (34%).

The hyperscaler index tightened 7.4bp yesterday to 146bp, roughly 4x the

1.8bp move on JULI at 93.7bp, marking the first session since early June when

the cohort meaningfully outperformed the broader index. Given the hyper-

focus on this segment of the market, we are introducing today a new