Lingering covid vies with inflation as top credit threat, finds BofA
Covid-19 lingering is catching up with inflation as credit investors' number one worry, Bank of America's August survey has found. The picture for central bank purchases is bullish, but strategists see industrial and bank senior bonds as shorts for contrarians over the summer

Rising stars will fuel double B boom, says BofA
A rising star cycle is underway and adds to a bullish outlook for double B credits with company results pointing to an ‘epic V-shaped recovery’ in high yield revenues and earnings, say Bank of America credit strategists

CLOs stand to win from US capital cost refinement, says BofA
A move by US insurance regulators to refine the capital charge framework for structured products will make CLOs more attractive versus corporate bonds, according to Bank of America strategists

CLO demand to drive loan outperformance over bonds: BNP Paribas
The buying power of CLOs and funds could mean leveraged loans rally further and outpace high yield bonds, says BNP Paribas' credit research team

JP Morgan raises 2021 US CLO forecast to record $135 billion
JP Morgan's research desk has raised its US CLO new issue forecast for 2021 to $135 billion

US private credit deals set to increase but flexible terms may not remain, finds Katten
The private credit market is optimistic about deal flow for 2021 but respondents in law firm Katten's survey are mindful that flexible deal terms will not remain forever

ESG drive poses little threat to CLO returns or flexibility, says Moody's
Environmental, social and governance investment criteria are not impairing CLOs either in flexibility or performance, Moody's Investors Service has found in a new report

Corp hybrid popularity mounts, but strategist outlooks diverge
Corporate hybrid bonds are becoming a focal point for investors in the second quarter, with one bank's credit strategy team making them a top pick to trade spread compression while another's has expressed caution on their likely performance

CLO investors still hungry for triple As and double Bs, says JP Morgan
Most CLO investors are looking to add risk through deals in the months ahead, with very few inclined to reduce exposure, a JP Morgan survey has found - despite the historic flood of issuance in the first quarter of this year

Yield rise is buying signal for bonds, says BNP Paribas
Credit spreads are set to hit new cyclical tights in the coming months, with the recent rise in yields having offered an attractive entry point especially for high-rated bonds, say BNP Paribas credit strategists

CLO equity ‘top trade’ could reach mid-teens returns, says JP Morgan
CLOs’ strong start to the year, in which the asset class has asset class has made gains against a sell off in government and corporate bonds, has put equity tranches on course for double digit returns in 2021, according to JP Morgan strategists

UN PRI's upcoming report on ESG in CLOs finds bar is very low
In a preview of the upcoming report, Carmen Nuzzo, head of fixed income at UN Principles for Responsible Investment, reveals to Creditflux key highlights from its ESG in securitisation report

Rates moves points to credit improvement, say BofA strategists
Focus on the rates market and the future direction of central banks has brought jitters back to credit in recent weeks and had a chilling affect on bond total returns. But higher government yields could end up being good for credit, say Bank of America strategists

ESG growth in CLOs has momentum in 2021, say JPM strategists
ESG investing in securitised products such as CLOs have 'momentum for growth in 2021' despite very slow volume growth and lack of progress in standardised scoring over the past year, say JP Morgan strategists in a research note

AGL hires ex Wells Fargo CLO research head Preston
AGL Credit Management has hired former Wells Fargo CLO research head David Preston

Buy CLO equity to capitalise on reflation, says JP Morgan
CLO equity stands out in a tightly priced market as offering up to double digit yields, say JP Morgan structured credit strategists, who posit it as their top trade

Bet on beta compression - except in sub fin CDS, say BofA strategists
Beta compression will be a dominant theme in 2021 for high yield versus investment grade CDS and bonds, financial versus non-financial credit and subordinated versus senior financial bonds, say Bank or America strategists in a research note. Short volatility positions are also attractive, they add, while cautioning sub versus senior financial CDS could buck the trend

Loan market delivers best one-day returns since April due to US election and vaccine
The S&P/LSTA Leveraged Loan Index recorded its best single day returns since April on Monday as investors celebrated in a string of positive developments that sent markets into overdrive

Robots rise for credit ratings
A fintech platform is launching this month that aims to use artificial intelligence to democratise credit ratings.

High yield outperformance to bring compression trade back into play: Citi
High yield underperformance versus investment grade is expected to reverse following the US presidential election, according to a strategy note from Citi. The bank’s strategists have been advocating compression trades since July and feel that there is more room for this to run citing election trends, exposure to coronavirus credits, expected default rates and credit ratings

Wells Fargo parts ways with star CLO research team
Wells Fargo is parting ways with its star CLO research team led by managing director David Preston

Senior bond-flex CLO tranches are 'cheapest bonds within securitised products': BofA
Triple A-rated notes of bond-flex CLOs are 'one of the cheapest bonds within securitised products', according to a new research paper by Bank of America

Go long index mezz tranches to pick up spread: Citi
Citi research has outlined some of the opportunities that have arisen in the index tranche market as a result of elevated correlation

CRE CLOs show resilience to sector decline in office properties, says Moody's
Commercial real estate CLOs are protected against a sector decline in office properties, Moody's has said in new research. CRE CLOs have structural protections, while portfolio office properties are largely in lower-cost areas with diversified economies and tenants, it argues

Size matters: exposure to small loan facilities worse than covid industries, says BofA
CLO managers that hold a higher portion of smaller sized facility loans in their portfolios have performed worse through the pandemic, according to a Bank of America research paper