A More Stable Outlook for the European High-Yield Market

In this video, Corporate Credit Portfolio Manager Tom Ross discusses the outlook for the European high-yield market and why he expects it to be relatively stable in the months ahead.

Key Takeaways

  • Extensive fiscal programs and central bank support have helped companies navigate the economic shock of COVID-19 and brought confidence back to the European high-yield bond market.
  • An acceleration in the spread of the virus remains a risk, but we do not expect a second wave to result in an economic shock as severe as the first wave, as evidence suggests social distancing is proving effective in many countries.
  • Absent an economic stoppage at the scale seen in the first quarter, the continued stimulus from global central banks combined with pent-up demand for European high-yield bonds should continue to provide support to the market.