Investment grade and high yield credit in emerging markets have delivered divergent performance over the summer. Could this trend reverse, or is investor caution warranted in the high yield space?
Eye on the Market: The Verdict
A relatively benign G20 summit and expectations for easier financial conditions ahead have boosted demand for emerging market debt. However, areas of value can still be found.
Michael looks at the midterms: GOP gains in the Senate, an historic loss in the House given economic and market conditions, and what it means for investors.
In this year’s Holiday Eye on the Market, Michael records a note to his spouse on her father, the 2020 US Presidential election, and what might be the widest ideological divide in 100 years.
The food fight between the President and the Fed Chair could result in too much easing, and the expansion of valuations beyond sustainable levels. The other food fight: leveraged loan issuers vs buyers. Issuers are winning this fight hands down due.
Despite attractive valuations, emerging market equities have underperformed. Things are improving, but a headwind looms: monetary policy
Michael discusses how short covering, rather than real money, has driven the fastest recovery on record following a bear market, and looks ahead at slowing earnings growth.
For the first time in 20 years, markets will have to survive without support from central banks.