IG payers provide best tail-risk hedges: Barclays
Investors seeking the cheapest tail risk hedge should look to CDX IG payers, while iTraxx Europe payers are the best hedge against further European underperformance, finds Barclays

Go long duration in consumers and industrials: BofA
The year’s wides still lie ahead in the second half, but China reopening is bullish for consumer and industrial spreads and investors should extend duration in high-quality credit, according to Bank of America strategists

Euro loans with FX hedging offer better value than US: Barclays
The big underperformance of European loans in June has left them looking cheap versus those in the US – but FX hedging and a nuanced selection process are advisable for investors looking to take advantage of that

Euro double As and US triple As offer best value in CLOs: BNP Paribas
Secondary market double A rated tranches offer the best relative value in European CLOs’ capital structures, while US triple As in primary starting to look attractive, according to BNP Paribas credit strategists

CLO spreads are not pricing in recession: JP Morgan
CLOs are priced fairly for a growth slowdown but not a recession, according to JP Morgan credit strategists, who warn spreads are at risk if US growth contracts

EU inflation prints frame challenge ahead as horror show first half ends
Financial markets are heading into the weekend with a rare stationary session, but the mood is more one of shellshock than considered positioning, after one of the worst first halves to a year on record

Manager selection stakes are heightening as CLO pain points intensify: Barclays
CLOs’ slump in market value and piling of distressed assets have made differentiation between managers much more acute on key metrics, regionally and by vintage, according to Barclays credit strategists

Credit lacks 'good answer' on what could cap spread widening: JP Morgan
Without any clear candidates to put a lid on spread widening, investment grade and high yield credit markets look set to extend much wider than current levels, warn JP Morgan strategists

CLO investors show more signs of optimism than other ABS: Barclays
CLO investors attending the Global ABS conference in Barcelona were more upbeat than those that work in residential mortgage-backed securities and other ABS, say Barclays securitised credit strategists. But the overall mood was sombre

Europe trades heavier than US as market baulks at new hikes
Credit spreads have resumed their push wider, with European indices once again under more pressure than their US counterparts

Credit rout eases as ECB holds emergency meeting ahead of Fed rates decision
Credit markets are undergoing a relief rally, even as the US Federal Reserve prepares to deliver its moment of truth decision on policy tightening and the European Central Bank holds an emergency meeting to address the recent sell-off in risk assets

Euro IG credit looks set to outperform US, HY and equities: Barclays
An outlook of elevated inflation and low growth favours credit over equities, and euro investment grade over high yield, according to European credit strategists at Barclays

Market jitters mount as US delivers May CPI
Credit spreads have moved sharply wider for the fourth day straight as investors digested the European Central Bank’s hawkish turn and watched with trepidation for the US to reveal its May consumer price index numbers

CLO top stack offers best value versus corp debt after junior tranche rally: Barclays
Having lagged in the recent market recovery, CLO triple A paper looks attractive versus corporate investment grade and the CDX IG credit derivatives index

Russia oil ban accord unites markets in sell off
EU leaders’ compromise agreement on banning Russian oil imports by sea has presented a united front few may have thought possible only days ago. But financial markets have not reacted positively, with risk assets selling off as the euro slumps and oil hits its highest level since March

Fund outflows extend despite sharp improvement in credit performance
This has been a much better week for credit and equity market performance than last, but that has not stopped the tide of investors looking to withdraw their money from funds for such risk assets

Bespoke bond baskets on the rise as investors seek targeted portfolio trades
High yield index replication and accessing illiquid exposure are two factors building momentum for a new investment approach that bundles bonds into a single risk piece

Credit fund bleed out looks hard to stem, as hawks ignore macro gloom
Ever more investors are running to safety as risk assets tally up another rough week, with strategists warning there is no end in sight for credit fund outflows while central banks hold their course on rate hikes

Credit retreats from wides, but worrisome test levels remain in view
Another rocky week for markets is ending with credit finding a firmer tone. But big questions remain unanswered about relative value and the levels some sectors could test

Think of the arb, say US CLO panelists after big loan drop
Far from being a cause for alarm, falling loan prices have brought a welcome opportunity in new CLO issuance for managers and investors, according to speakers at the Creditflux Symposium in London today

Macro woes have dented CLO and loan outlook: Barclays
Rising interest rates and elevated macro volatility have negatively impacted the performance outlook for both loans and CLOs, according to Barclays credit strategists

Post-Fed volatility prompts stark reassessment of credit relative value
Central bank policy moves have caught markets off-guard, with volatility ensuing and spreads hitting new wides 

High yield / loan slowdown affects year-end projections and pricing: Barclays
A sharp decline in primary market activity means expectations for high yield bond and even leveraged loan issuance need to be lowered, say Barclays credit strategists. And that in turn has implications for relative value

CLOs look attractive after corporate rally - but not all tranches: Barclays
Rallying corporate cash credit spreads over the past two weeks have widened the basis with CLOs and made these products look attractive again, according to Barclays strategists

Hidden loan tail risks and mounting single B exposure could pose problem for CLOs: Barclays
A solid rally for leveraged loans this week - against returning weakness in bonds - has put focus back on the market, which seemingly has little tail risk priced in. But short term support factors and a dwindling triple C bucket mask the quality skew, warn Barclays strategists in a note today - which could spell downgrades for single-B minus rated loans