Investors Flee Junk Bonds in Droves as Trade War Batters Markets
- Buyers pull most from speculative-grade bond funds since 2018
- Investment-grade funds had $2.8 billion of inflows for week
Pedestrians walk near the New York Stock Exchange.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
Credit investors yanked cash from U.S. high-yield bond funds and added money to investment-grade securities as the global trade war and recession concerns prompted a move away from risky assets.
Investors withdrew $4.07 billion from junk funds for the week ended Aug. 7, according to Refinitiv’s Lipper. It was the biggest outflow since the end of October as the U.S.-China trade war heated up, causing equities to drop and interest rates to rally earlier this week. Investment-grade funds posted inflows of $2.8 billion.