
Muzinich Weekly Market Comment
The most discussed topic for the week has been recession.
The most discussed topic for the week has been recession.
Despite the heavy price action we have witnessed in the high yield market since the start of the year.
Global credit markets delivered mixed returns. Following a sharp rally during the last week of the month, HY locked in its first positive week of the last seven weeks, and more importantly unwound all of the month’s prior losses to deliver its first positive month of the year
The growth of non-bank financial intermediation (“NBFI”) is a clear worldwide trend over the last 15 years.
With the tragedy unfolding in Ukraine and persistent concerns about inflation, fear has now started to replace greed in markets, which may create interesting opportunities for long term investors. It is very difficult to time markets, but we believe a focus on fundamentals during periods of volatility helps provide a framework for good decision making.
Putin’s attack on Ukraine is having wide-reaching consequences for global financial market as investors reconsider their options
Against a backdrop of economic recovery but the prospect of rising interest rates, where can credit investors look for yield while protecting themselves from interest rate risk?
The recent relaxation of Chinese property sector regulations, a lack of inflationary pressure, stronger external positions vs. the 2013 Taper Tantrum
Despite a shaky start to the year for risk assets, emerging markets have held up relatively well and we believe offer encouraging investment opportunities which are backed by economic recovery.
Will developed market central banks follow their emerging market counterparts in combatting inflationary pressures?
Caution Warranted as Rates Moves and Higher Inflation Cloud the Outlook for Credit.
We believe a recent rise in volatility presents an interesting opportunity for investors in US high yield.
Does a strong recovery in deal flow and the prospect of protection from rising interest rates reinforce the investment case for private debt?
While risks remain, we expect the global economic momentum to continue into 2022, creating a potentially positive backdrop for credit.
An anticipated increase of rising stars in US high yield over the next 12 to 18 months could result in a strong technical backdrop for the asset class.
Deeply interconnected global themes are driving inflationary pressures, it’s not just because of a post-COVID surge in economic activity argues Tatjana Greil-Castro.
With the climate science increasingly undisputed and the latest IPCC1 report a timely reminder of the urgency for global climate action, expectations of the impending UN Climate Change Conference (COP 26) in November are higher than ever.
Fiscal rules and political developments in the EU
The European Union’s Sustainable Finance Disclosure Regulation (SFDR) came into force in March 2021.
Traditionally viewed as ‘riskier’ assets, emerging market (EM) corporate bonds tend to have a higher Sharpe ratio and higher credit ratings than their sovereign counterparts. In a post-pandemic world, what might this mean for those considering an EM allocation?
While headlines surrounding a beleaguered Chinese property company have raised questions on the potential for broader contagion, we believe the situation is likely to be contained by Chinese policymakers. Portfolio Managers Warren Hyland and Christina Bastin discuss.
We believe low default rates and robust fundamentals offer a compelling investment case for US high yield, underpinned by a strong economic backdrop.
While private debt is firmly embedded in the US and Europe, the asset class is playing catch up in the Asia Pacific region.
As we move into the second half of the year, and as the global pandemic appears to be petering out.
While the global pandemic resulted in another risk-off scenario for financial markets, risk events are a common occurrence that investors need to navigate.
As the end of the global pandemic nears, we believe an interesting opportunity in aviation finance has arisen.
As interest rates trend higher, should investors consider an allocation to syndicated loans?
Since the second half of 2020, there have been interesting opportunities in reopening sectors such as airlines, leisure and hotels.
Are debt, digital and climate transforming central banking and the broader economy?
A positive outlook.
What does the appointment of the fourth central bank governor in less than two years mean for investors in Turkey?
With the recent rise in rates and fears for a long-term move higher in inflation, how are you positioning your multi-asset credit strategies?
We believe the calm and measured character of the ox is likely to be reflected in China’s economic and political stance in 2021, which could provide opportunities for investors
During 2020, governments took measures to address the immediate economic consequences of the pandemic. Will we see these measures be progressively phased out in 2021, and will public finance start to consolidate?
A brighter economic future is reasonably expected in 2021, but active and smart management will be required to navigate credit markets with tighter valuations.
We have asked six of our portfolio managers to comment on past and current challenges, and to share their thoughts on what to expect next.
Syndicated Loans in a Recessionary Environment
Potential Opportunities in Challenged Markets
The rapid global spread of COVID-19 and the subsequent lockdown measures have resulted in a global humanitarian and working capital crisis rolled into one event.
The rapid global spread of COVID-19 and the subsequent lockdown measures have resulted in a global humanitarian and working capital crisis rolled into one event.
West Texas Intermediate (WTI) oil fell to a record low last week as demand collapsed in the wake of the COVID-19 lock-down and the Saudi Arabia/Russia price war.
The Eurogroup met on the evening of Tuesday, April 7th, and after a night-long negotiation which didn’t lead to an agreement, reconvened on Thursday, April 9th. Eventually, the gridlock was broken and a common position on a comprehensive package of measures was reached.
The renewed debate of debt mutualisation threatens to create new cracks on the European project.
Long Term Valuations Can’t Be Ignored
Where might investors find yield, protection from volatility and investment opportunities across the credit cycle?
Addressing the misperceptions about US Market Potential.
What impact is the outbreak in China likely to have on the global economy and financial markets?
Please click to watch our new video – an introduction to Private Debt.
How can retail investors and the real economy benefit from a changing regulatory environment?
Please click to view our Corporate Credit Outlook for 2020 by Director of Product & Investment Strategy, Erick Muller.
Please click to view our latest Macro Outlook from Director of Product & Investment Strategy, Erick Muller.
How the recent European Central Bank easing measures might impact the credit profile of eurozone banks?
Evolving policy initiatives are broadening the scope for small and medium-sized enterprises to access financing
How will the ongoing civil unrest in Hong Kong impact its economy and relationship with China?
Will looser US monetary policy benefit hard or local currency denominated emerging market corporate bonds?
Please click to view our latest Macro Outlook from Director of Product & Investment Strategy, Erick Muller.
Against a backdrop of increasing global uncertainty, many are concerned about an economic scenario that puts widespread pressure on credit ratings.
As the US/China trade war continues to heat up, can idiosyncratic risks in some sectors benefit others?
Will upcoming European elections impact broader market sentiment?
Please click to view our latest Macro Outlook from Director of Product & Investment Strategy, Erick Muller.
Recent research trips to India and Indonesia provide valuable insight ahead of upcoming elections
How might investors access the benefits of private debt whilst avoiding the restraints incurred by traditionally illiquid assets?
Underlying fundamentals remain solid despite recent price weakness
What key themes are likely to impact socio-political and economic developments?
Private Debt Portfolio Managers Eric Green and Jeff Youle reiterate their conviction in the asset class
As increasing macroeconomic and geopolitical risks lead to rising volatility, where do we see the main opportunities and challenges for credit markets in 2019?
UK private debt Co-Heads Grant Davidson and John Clifford, discuss the lending landscape in the UK lower mid-market
Fabrizio Pagani offers his insights from the G20 summit
A segment of the investment grade market has leverage multiples more in-line with high yield.
Fabrizio Pagani offers his insights into the current political situation surrounding Italy’s budgetary challenges and its relationship with the European Union.
Seeking stable returns in most market conditions.
Can socially responsible investing enhance returns in corporate credit?
Portfolio Manager Warren Hyland discusses how he has sought to forge a leading path in emerging market short duration corporate debt.
The country’s geographical location and NATO membership could prove the key to ensuring the country’s long-term stability
The government faces an ongoing battle for reform
With growing pressures in the direct lending market, is the asset class still a viable alternative for investors seeking higher yields?
As rates move higher in the US, and are likely to follow suit in Europe, can credit investors gain exposure to attractive returns with limited duration risk?
Recent weakness in EM belies underlying fundamental strength in a maturing asset class
As volatility rises and the beta rally draws to a close, how can investors seek to strike a balance between return maximisation and drawdown protection?
We believe the solid technical backdrop continues to underpin the asset class.
We believe Sustainability and Responsible Investing are becoming increasingly important for investors. See how we view this key topic.
Following the recent sell off in EM corporate bonds, has the short duration segment reached an attractive entry point?
As we enter the latter stages of the economic cycle, we expect to see increasing dispersion of returns across high yield and loans.
How can credit investors seek to have the right exposure at the right time to maximise their return potential, minimise risk and dampen volatility?
As base rates move towards more normalised levels, where can fixed income investors gain protection from rising rates and source attractive returns?
With deteriorating fundamentals in the sovereign universe, should investors consider increasing their allocation into corporates?
Rates and passive investment strategies create challenges for fixed income investors, corporate credit continues to provide attractive opportunities.
Mike McEachern, Portfolio Manager and Head of Public Markets, discusses the benefits of a multi-asset approach to credit investing.
Analyst View – the latest insights from our credit analysts
What does 2018 have in store for corporate credit markets?
What does the re-election of Xi Jinping mean for China’s political and economic outlook?
Why are US high yield spreads tighter this year when the market has experienced net mutual fund outflows year-to-date?
What does the final few months of 2017 have in store for global corporate credit?
With its second downgrade in less than six months, should investors be concerned about China’s creditworthiness?
Declining credit quality in the investment grade corporate universe means the need for bottom-up credit research is now more important than ever.
An allocation into direct lending can offer insurers with a diversified source of higher, less volatile returns over a longer-term time horizon.
Accessing an underinvested asset class against a backdrop of improving growth can provide investors a better risk-reward profile than developed market credit.
It may seem strange to consider Emerging Markets as a potential safe haven, but arguably, that is now the view of many looking to mitigate political uncertainties.