High Yield Morning Update

Today is the last Fed conference in the Bernanke era, and an important one for the markets as investors looks for clarity around upcoming tapering. Tuesday’s flows were flat and a reversal of the recent trend with a small inflow into exchange traded funds and a small outflow from actively managed mutual funds. The primary market was quiet yesterday with no new deals pricing on the day, ending a streak of eight straight days with at least $1 billion in issuance. Three deals remain on the forward calendar, but liquidity is definitely starting to dry up and bid/offer spreads are starting to widen. This morning all markets are quiet as we sit and wait for the Fed news this afternoon.

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