U.S. News
- Consumer Confidence
- The Consumer Confidence Index fell to 106.7 in February, down from 110.9 in January
- The month over month decline is partly due to angst about the U.S. presidential election later this year
- Confidence has improved considerably since late last year thanks to slowing inflation, but it’s still well below the pre-pandemic high
- New Home Sales
- Sales of new single-family houses in the United States rose by 1.5% from the previous month to a seasonally adjusted annualized rate of 661,000 in January
- The reading marked the second straight month of higher sales, consistent with the drop in mortgage rates during the first month of the year
- Sales increased the most in the Northeast and the West, but grew more slowly in the Midwest and declined in the South
- Consumer Income
- Incomes jumped 1.0% in January, aided by higher dividend payments and the annual cost-of-living adjustment in Social Security
- Consumers are taking out bigger loans at higher interest rates or using their credit cards more
- The savings rate rose slightly to 3.8% in January, but it’s still near the lowest level of the pandemic era
- Jobless Claims
- Initial jobless claims, a measure of how many workers were laid off across the U.S., increased to 215,000 in the week ended February 23, up 13,000 from the prior week
- The four-week moving average was 212,500, down 3000 from the prior week
- Continuing claims – those filed by workers unemployed for longer than a week – increased by 45,000 to 1.905 million in the week ended February 16. This figure is reported with a one-week lag
- Fed’s Balance Sheet
- The Federal Reserve’s assets totaled $7.568 trillion in the week ended March 1, down $13.9 billion from the prior week
- Treasury holdings totaled $4.661 trillion, down $0.1 billion from the prior week
- Holdings of mortgage-backed securities (MBS) were $2.41 trillion in the week, down $7.7 billion from the prior week
- Total Public Debt
- Total public debt outstanding was $34.38 trillion as of March 1, an increase of 9.3% from the previous year
- Debt held by the public was $24.61 trillion, and intragovernmental holdings were $7.12 trillion
- Inflation Factors
- CPI:
- The consumer-price index rose 3.1% in January year over year
- On a monthly basis, the CPI increased 0.3% in January on a seasonally adjusted basis, after increasing 0.2% in December
- The index for all items less food and energy (core CPI) rose 0.4% in January, after rising 0.3% in December
- Core CPI increased 3.9% for the 12 months ending January
- Food and Beverages:
- The food at home index increased 1.2% in January from the same month a year earlier, and increased 0.4% in January month over month
- The food away from home index increased 5.1% in January from the same month a year earlier, and increased 0.5% in January month over month
- Commodities:
- The energy commodities index decreased (3.2%) in January after decreasing (0.7%)
- The energy commodities index fell (6.8%) over the last 12 months
- The energy services index 2.5% in January after increasing 0.4% in December
- The energy services index fell (2.0%) over the last 12 months
- The gasoline index fell (6.4%) over the last 12 months
- The fuel oil index fell (14.2%) over the last 12 months
- The index for electricity rose 3.8% over the last 12 months
- The index for natural gas fell (17.8%) over the last 12 months
- Supply Chain:
- Drewry’s composite World Container Index decreased to $3,493.19 per 40ft container
- Drewry’s composite World Container Index has increased by 87.9% over the last 12 months
- Housing Market:
- The shelter index increased 0.6% in January after increasing 0.4% in December
- The rent index increased 0.6% in January after increasing 0.4% in December
- The index for lodging away from home increased 4.3% in January after decreasing (1.1%) in December
- Fed Funds Rate
- The effective Federal Funds Rate is at 5.33%, flat 0.00% year to date
World News
-
Russia
- Russian President Vladimir Putin has raised the threat of a nuclear conflict if Ukraine’s allies step further into the war
- While the Russian leader has repeatedly issued nuclear threats, and experts say the use of such weapons remains highly unlikely, the warnings come amid heightened anxiety in Europe about U.S. commitment to its security
- The talk of nuclear escalation in Putin’s annual parliamentary speech Thursday also reinforces the Russian president’s framing of the war in Ukraine as an existential conflict with the West, raising risks of a wider confrontation as global arms-control mechanisms disintegrate
-
Israel
- Senior members of Hamas’s leadership in exile met in Doha, Qatar, earlier this month amid concerns that its fighters were overrun by an Israeli offensive in the Gaza Strip
- The militants have changed their tactics since a short cease-fire in November. Hamas fighters are now trying to avoid large firefights and instead use small-scale ambushes – using tools ranging from rocket-propelled grenades to recorded voices of hostages to lure Israeli troops into traps
-
China
- Chinese property giant Country Garden Holdings is facing renewed pressure to settle its debt crisis with offshore investors after a creditor asked a court to liquidate the company over the nonpayment of a more than $200 million loan
- Country Garden has been seeking to restructure billions of dollars in offshore debt with investors, coming amid a multiyear property downturn in China as officials sought to rein in rising levels of industry debt
- Country Garden had more than $15 billion of international bonds and loans outstanding at the end of June 2023, according to its public disclosures. It missed a deadline to make an interest payment on a dollar bond in October
- China Evergrande Group, once China’s largest developer, last month became one of the biggest casualties of the crisis when it was ordered to liquidate by a Hong Kong court following unsuccessful efforts to restructure billions of dollars in debt
-
Japan
- Japan’s consumer prices rose at the slowest pace in nearly two years in January, but came in above expectations, backing views that the central bank will exit its negative interest rate policy, albeit cautiously
-
Australia
- Australian home prices hit a high in what was already one of the world’s most expensive real-estate markets. Now, Australian officials say they have a plan that will help to make housing more affordable: curtailing migration
-
Canada
- Lynx Air, a budget airline based in Calgary, is shutting down due to rising costs, unfavorable exchange rates, and competitive tension in the Canadian aviation market
-
Argentina
- President Javier Milei of Argentina hosted U.S. Secretary of State Antony J. Blinken in Buenos Aires to discuss reshaping Argentina’s foreign policy in alignment with the United States, amidst economic challenges and the pursuit of stability
-
Brazil
- Brazilian Federal Police seized the passport of former President Jair Bolsonaro and arrested four of his close allies as authorities narrowed in on the conservative and his aides over allegations that they plotted a military takeover as early as late-2022
-
Nicaragua
- Nicaragua’s authoritarian government, which has expelled religious leaders, political opponents and journalists, has granted asylum to a former Panamanian president convicted of money laundering, the third former leader from the region to find refuge in Managua
-
Sweden
- Hungarian Prime Minister Viktor Orban escalated a standoff with Western allies over Sweden’s NATO accession after a senior US lawmaker called for potential sanctions against the lone holdout
Commodities
-
Oil Prices
- WTI: $79.79 per barrel
- +4.31% WoW; +11.36% YTD; +2.09% YoY
- Brent: $83.40 per barrel
- +2.18% WoW; +8.26% YTD; (1.59%) YoY
-
US Production
- U.S. oil production amounted to 13.3 million bpd for the week ended February 23, down 0.0 million bpd
from the prior week
-
Rig Count
- The total number of oil rigs amounted to 629, up 3 from last week
-
Inventories
-
Crude Oil
- Total U.S. crude oil inventories now amount to 447.2 million barrels, down (6.9%) YoY
- Refiners operated at a capacity utilization rate of 81.5% for the week, up from 80.6% in the prior week
- U.S. crude oil imports now amount to 6.654 million barrels per day, down 2.9% YoY
-
Gasoline
- Retail average regular gasoline prices amounted to $3.33 per gallon in the week of March 1,
down (1.7%) YoY
- Gasoline prices on the East Coast amounted to $3.31, down (1.0%) YoY
- Gasoline prices in the Midwest amounted to $3.17, down (2.1%) YoY
- Gasoline prices on the Gulf Coast amounted to $2.94, down (2.0%) YoY
- Gasoline prices in the Rocky Mountain region amounted to $3.10, down (20.6%) YoY
- Gasoline prices on the West Coast amounted to $4.21, down (3.6%) YoY
- Motor gasoline inventories were down by 2.8 million barrels from the prior week
- Motor gasoline inventories amounted to 244.2 million barrels, up 2.1% YoY
- Production of motor gasoline averaged 9.42 million bpd, down (3.2%) YoY
- Demand for motor gasoline amounted to 8.467 million bpd, down (7.1%) YoY
-
Distillates
- Distillate inventories decreased by -0.5 million in the week of March 1
- Total distillate inventories amounted to 121.1 million barrels, down (0.8%) YoY
- Distillate production averaged 4.289 million bpd, down (6.9%) YoY
- Demand for distillates averaged 3.536 million bpd in the week, down (7.8%) YoY
-
Natural Gas
- Natural gas inventories decreased by 96 billion cubic feet last week
- Total natural gas inventories now amount to 2,374 billion cubic feet, up 12.3% YoY
Credit News
High yield bond yields increased 1bps to 7.80% and spreads increased 8bps to 341bps. Leveraged loan yields decreased 9bps to 9.39% and spreads decreased 3bps to 519bps. WTD Leveraged loan returns were positive 24bps. WTD high yield bond returns were positive 11bps. 10yr treasury yields decreased 7bp to 4.25%. For the week, HY spreads and yields widened as incoming data suggested an improving rather cooling economy, keeping the Fed cautious on rate cuts. LL yields and spreads tightened amid resilient growth and rapidly improving capital market access.
High-yield:
Week ended 03/01/2024
- Yields & Spreads1
- Pricing & Returns1
- Fund Flows2
- New Issue2
- Distressed Level (trading in excess of 1,000 bps)2
- Total HY Defaults
1 Source: Credit Suisse High Yield and Leveraged Loan Index
2 Source: JP Morgan
Leveraged loans:
Week ended 03/01/2024
- Yields & Spreads1
- Leveraged Loan Index1
- Fund Flows2
- New Issue2
- Distressed Level (loan price below $80)1
- Total Loan Defaults
Default activity:
- Most recent defaults include: Robertshaw ($820mn, 2/29/24), Thrasio LLC ($724mn, 2/28/24), Hornblower ($838mn, 2/20/24), Careismatic ($700mn, 1/22/24), Enviva Partners ($750mn, 1/15/24), Ligado Networks ($4.2bn, 11/1/23), and Air Methods ($1.7bn, 10/24/23).
CLOs:
Week ended 03/01/2024
- New U.S. CLO Issuance2
- New U.S. CLO Issuance2
Note:High-yield and leveraged loan yields and spreads are swap-adjusted
1 Source: Credit Suisse High Yield and Leveraged Loan Index
2 Source: JP Morgan
Ratings activity:
- S&P and Moody’s High Yield Ratings
Appendix:
Diagram A: Leveraged Loan Trading Levels
Source: Credit Suisse Leveraged Loan Index
Diagram B: High Yield and Leveraged Loan LTM Price
Diagram C: Leveraged Loan and High Yield Returns
Diagram J: Leveraged Loan Defaults by Sector – Full Year
Diagram L: CLO Economics
Diagram N: Developed Country GovBond Yields (%)
Diagram O: S&P 500 Historical Multiples
Diagram P: U.S. Middle-Market M&A Valuations (EV/EBITDA)
Diagram Q: U.S. Large Cap M&A Valuations (EV/EBITDA
Diagram R: Dry Powder for All Private Equity Buyouts
Diagram S: Structured Credit Spreads
Diagram T: Structured Credit Yield
Diagram U: CAT Bonds – Cumulative Returns
Diagram V: SOFR CURVE
Freight Rates
Drewry World Container Index
China-Global & Shanghai Export Container Freight Index
U.S. News
- Consumer Confidence
- The Consumer Confidence Index fell to 106.7 in February, down from 110.9 in January
- The month over month decline is partly due to angst about the U.S. presidential election later this year
- Confidence has improved considerably since late last year thanks to slowing inflation, but it’s still well below the pre-pandemic high
- New Home Sales
- Sales of new single-family houses in the United States rose by 1.5% from the previous month to a seasonally adjusted annualized rate of 661,000 in January
- The reading marked the second straight month of higher sales, consistent with the drop in mortgage rates during the first month of the year
- Sales increased the most in the Northeast and the West, but grew more slowly in the Midwest and declined in the South
- Consumer Income
- Incomes jumped 1.0% in January, aided by higher dividend payments and the annual cost-of-living adjustment in Social Security
- Consumers are taking out bigger loans at higher interest rates or using their credit cards more
- The savings rate rose slightly to 3.8% in January, but it’s still near the lowest level of the pandemic era
- Jobless Claims
- Initial jobless claims, a measure of how many workers were laid off across the U.S., increased to 215,000 in the week ended February 23, up 13,000 from the prior week
- The four-week moving average was 212,500, down 3000 from the prior week
- Continuing claims – those filed by workers unemployed for longer than a week – increased by 45,000 to 1.905 million in the week ended February 16. This figure is reported with a one-week lag
- Fed’s Balance Sheet
- The Federal Reserve’s assets totaled $7.568 trillion in the week ended March 1, down $13.9 billion from the prior week
- Treasury holdings totaled $4.661 trillion, down $0.1 billion from the prior week
- Holdings of mortgage-backed securities (MBS) were $2.41 trillion in the week, down $7.7 billion from the prior week
- Total Public Debt
- Total public debt outstanding was $34.38 trillion as of March 1, an increase of 9.3% from the previous year
- Debt held by the public was $24.61 trillion, and intragovernmental holdings were $7.12 trillion
- Inflation Factors
- CPI:
- The consumer-price index rose 3.1% in January year over year
- On a monthly basis, the CPI increased 0.3% in January on a seasonally adjusted basis, after increasing 0.2% in December
- The index for all items less food and energy (core CPI) rose 0.4% in January, after rising 0.3% in December
- Core CPI increased 3.9% for the 12 months ending January
- Food and Beverages:
- The food at home index increased 1.2% in January from the same month a year earlier, and increased 0.4% in January month over month
- The food away from home index increased 5.1% in January from the same month a year earlier, and increased 0.5% in January month over month
- Commodities:
- The energy commodities index decreased (3.2%) in January after decreasing (0.7%)
- The energy commodities index fell (6.8%) over the last 12 months
- The energy services index 2.5% in January after increasing 0.4% in December
- The energy services index fell (2.0%) over the last 12 months
- The gasoline index fell (6.4%) over the last 12 months
- The fuel oil index fell (14.2%) over the last 12 months
- The index for electricity rose 3.8% over the last 12 months
- The index for natural gas fell (17.8%) over the last 12 months
- Supply Chain:
- Drewry’s composite World Container Index decreased to $3,493.19 per 40ft container
- Drewry’s composite World Container Index has increased by 87.9% over the last 12 months
- Housing Market:
- The shelter index increased 0.6% in January after increasing 0.4% in December
- The rent index increased 0.6% in January after increasing 0.4% in December
- The index for lodging away from home increased 4.3% in January after decreasing (1.1%) in December
- Fed Funds Rate
- The effective Federal Funds Rate is at 5.33%, flat 0.00% year to date
World News
-
Russia
- Russian President Vladimir Putin has raised the threat of a nuclear conflict if Ukraine’s allies step further into the war
- While the Russian leader has repeatedly issued nuclear threats, and experts say the use of such weapons remains highly unlikely, the warnings come amid heightened anxiety in Europe about U.S. commitment to its security
- The talk of nuclear escalation in Putin’s annual parliamentary speech Thursday also reinforces the Russian president’s framing of the war in Ukraine as an existential conflict with the West, raising risks of a wider confrontation as global arms-control mechanisms disintegrate
-
Israel
- Senior members of Hamas’s leadership in exile met in Doha, Qatar, earlier this month amid concerns that its fighters were overrun by an Israeli offensive in the Gaza Strip
- The militants have changed their tactics since a short cease-fire in November. Hamas fighters are now trying to avoid large firefights and instead use small-scale ambushes – using tools ranging from rocket-propelled grenades to recorded voices of hostages to lure Israeli troops into traps
-
China
- Chinese property giant Country Garden Holdings is facing renewed pressure to settle its debt crisis with offshore investors after a creditor asked a court to liquidate the company over the nonpayment of a more than $200 million loan
- Country Garden has been seeking to restructure billions of dollars in offshore debt with investors, coming amid a multiyear property downturn in China as officials sought to rein in rising levels of industry debt
- Country Garden had more than $15 billion of international bonds and loans outstanding at the end of June 2023, according to its public disclosures. It missed a deadline to make an interest payment on a dollar bond in October
- China Evergrande Group, once China’s largest developer, last month became one of the biggest casualties of the crisis when it was ordered to liquidate by a Hong Kong court following unsuccessful efforts to restructure billions of dollars in debt
-
Japan
- Japan’s consumer prices rose at the slowest pace in nearly two years in January, but came in above expectations, backing views that the central bank will exit its negative interest rate policy, albeit cautiously
-
Australia
- Australian home prices hit a high in what was already one of the world’s most expensive real-estate markets. Now, Australian officials say they have a plan that will help to make housing more affordable: curtailing migration
-
Canada
- Lynx Air, a budget airline based in Calgary, is shutting down due to rising costs, unfavorable exchange rates, and competitive tension in the Canadian aviation market
-
Argentina
- President Javier Milei of Argentina hosted U.S. Secretary of State Antony J. Blinken in Buenos Aires to discuss reshaping Argentina’s foreign policy in alignment with the United States, amidst economic challenges and the pursuit of stability
-
Brazil
- Brazilian Federal Police seized the passport of former President Jair Bolsonaro and arrested four of his close allies as authorities narrowed in on the conservative and his aides over allegations that they plotted a military takeover as early as late-2022
-
Nicaragua
- Nicaragua’s authoritarian government, which has expelled religious leaders, political opponents and journalists, has granted asylum to a former Panamanian president convicted of money laundering, the third former leader from the region to find refuge in Managua
-
Sweden
- Hungarian Prime Minister Viktor Orban escalated a standoff with Western allies over Sweden’s NATO accession after a senior US lawmaker called for potential sanctions against the lone holdout
Commodities
-
Oil Prices
- WTI: $79.79 per barrel
- +4.31% WoW; +11.36% YTD; +2.09% YoY
- Brent: $83.40 per barrel
- +2.18% WoW; +8.26% YTD; (1.59%) YoY
-
US Production
- U.S. oil production amounted to 13.3 million bpd for the week ended February 23, down 0.0 million bpd
from the prior week
-
Rig Count
- The total number of oil rigs amounted to 629, up 3 from last week
-
Inventories
-
Crude Oil
- Total U.S. crude oil inventories now amount to 447.2 million barrels, down (6.9%) YoY
- Refiners operated at a capacity utilization rate of 81.5% for the week, up from 80.6% in the prior week
- U.S. crude oil imports now amount to 6.654 million barrels per day, down 2.9% YoY
-
Gasoline
- Retail average regular gasoline prices amounted to $3.33 per gallon in the week of March 1,
down (1.7%) YoY
- Gasoline prices on the East Coast amounted to $3.31, down (1.0%) YoY
- Gasoline prices in the Midwest amounted to $3.17, down (2.1%) YoY
- Gasoline prices on the Gulf Coast amounted to $2.94, down (2.0%) YoY
- Gasoline prices in the Rocky Mountain region amounted to $3.10, down (20.6%) YoY
- Gasoline prices on the West Coast amounted to $4.21, down (3.6%) YoY
- Motor gasoline inventories were down by 2.8 million barrels from the prior week
- Motor gasoline inventories amounted to 244.2 million barrels, up 2.1% YoY
- Production of motor gasoline averaged 9.42 million bpd, down (3.2%) YoY
- Demand for motor gasoline amounted to 8.467 million bpd, down (7.1%) YoY
-
Distillates
- Distillate inventories decreased by -0.5 million in the week of March 1
- Total distillate inventories amounted to 121.1 million barrels, down (0.8%) YoY
- Distillate production averaged 4.289 million bpd, down (6.9%) YoY
- Demand for distillates averaged 3.536 million bpd in the week, down (7.8%) YoY
-
Natural Gas
- Natural gas inventories decreased by 96 billion cubic feet last week
- Total natural gas inventories now amount to 2,374 billion cubic feet, up 12.3% YoY
Credit News
High yield bond yields increased 1bps to 7.80% and spreads increased 8bps to 341bps. Leveraged loan yields decreased 9bps to 9.39% and spreads decreased 3bps to 519bps. WTD Leveraged loan returns were positive 24bps. WTD high yield bond returns were positive 11bps. 10yr treasury yields decreased 7bp to 4.25%. For the week, HY spreads and yields widened as incoming data suggested an improving rather cooling economy, keeping the Fed cautious on rate cuts. LL yields and spreads tightened amid resilient growth and rapidly improving capital market access.
High-yield:
Week ended 03/01/2024
- Yields & Spreads1
- Pricing & Returns1
- Fund Flows2
- New Issue2
- Distressed Level (trading in excess of 1,000 bps)2
- Total HY Defaults
1 Source: Credit Suisse High Yield and Leveraged Loan Index
2 Source: JP Morgan
Leveraged loans:
Week ended 03/01/2024
- Yields & Spreads1
- Leveraged Loan Index1
- Fund Flows2
- New Issue2
- Distressed Level (loan price below $80)1
- Total Loan Defaults
Default activity:
- Most recent defaults include: Robertshaw ($820mn, 2/29/24), Thrasio LLC ($724mn, 2/28/24), Hornblower ($838mn, 2/20/24), Careismatic ($700mn, 1/22/24), Enviva Partners ($750mn, 1/15/24), Ligado Networks ($4.2bn, 11/1/23), and Air Methods ($1.7bn, 10/24/23).
CLOs:
Week ended 03/01/2024
- New U.S. CLO Issuance2
- New U.S. CLO Issuance2
Note:High-yield and leveraged loan yields and spreads are swap-adjusted
1 Source: Credit Suisse High Yield and Leveraged Loan Index
2 Source: JP Morgan
Ratings activity:
- S&P and Moody’s High Yield Ratings
Appendix:
Diagram A: Leveraged Loan Trading Levels
Source: Credit Suisse Leveraged Loan Index
Diagram B: High Yield and Leveraged Loan LTM Price
Diagram C: Leveraged Loan and High Yield Returns
Diagram J: Leveraged Loan Defaults by Sector – Full Year
Diagram L: CLO Economics
Diagram N: Developed Country GovBond Yields (%)
Diagram O: S&P 500 Historical Multiples
Diagram P: U.S. Middle-Market M&A Valuations (EV/EBITDA)
Diagram Q: U.S. Large Cap M&A Valuations (EV/EBITDA
Diagram R: Dry Powder for All Private Equity Buyouts
Diagram S: Structured Credit Spreads
Diagram T: Structured Credit Yield
Diagram U: CAT Bonds – Cumulative Returns
Diagram V: SOFR CURVE
Freight Rates
Drewry World Container Index
China-Global & Shanghai Export Container Freight Index