Cecile Gutscher writes at Bloomberg that corporate bonds are offering their highest yields in years:
You need to rifle through 18 years of history to find selloffs that compare to the one corporate bond investors are now enduring.
Debt of American companies just posted their third-worst 100-day returns since 2000, according to a JPMorgan Chase & Co. index, as tighter monetary conditions leave their mark on high-quality bonds with longer maturities.
With negative returns likely to scare off retail investors, the outlook for the asset class looks grim, JPMorgan strategists said in a Friday note. But they find a silver lining: the highest yields in almost five years are likely to discourage new bond supply, which would at least help the technical picture.
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