U.S. Junk Bonds Rally Most in Two Decades With Fed Now a Buyer

U.S. junk bonds rallied the most since 1998 after the Federal Reserve’s historic move to begin buying some of the speculative-grade corporate debt.

The extra yield investors demand to own the securities instead of Treasuries narrowed 86 basis points Thursday to 785 basis points, the lowest level since March 13, according to the Bloomberg Barclays U.S. Corporate High-Yield index.