The Cracks in Credit Markets Are Growing Deeper
- Weakness also seen from high-grade bonds to default swaps
- Investment-grade debt on track for worst year since 2008
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The cracks in the credit market are widening as investors face their fears about the mountains of debt weighing on corporate America.
If pressure began building last month, things blew up last week: High-grade bond spreads widened the most in nearly two years, premiums paid for junk bonds jumped the most in almost two years, and the prices of leveraged loans sank to the lowest since 2016. As a result, companies selling bonds have paid a price.