2 Question Tuesday – 10/24/2023 – What’s Going On In The Stock And Bond Markets & Will High Interest Rates Cause Junk Bonds To Spark A Major Credit Event?

Welcome to 2 Question Tuesday. This week’s client submitted questions were:

  1. What’s going on in the stock and bond markets?
  2. Will high interest rates cause junk bonds to spark a major credit event?

Phil, Mike, and Larry discuss what’s going on in the markets after the yield on the 10-year U.S. Treasury bond hit 5% last week for the first time since 2007, and the S&P 500 posted its worst week in a month and fell below its 200-day moving average. They then talk about how the number of junk bonds set to mature in the next 36 months has soared to levels last seen in 2007. The junk bond issuers that are poised-to-refinance make up 19% of the total high-yield market, but they will likely have trouble surviving in an era of prolonged high interest rates. This may drive a lot of these names into bankruptcy causing a major credit event.

Submit your questions to question@2questiontuesday.com

As always, if you have any questions at any time, please feel free to call your adviser directly at (845) 691-4035.

Host Lawrence Carrel’s books available available at Amazon.com