Stress in commodities continues to hit high-yield investors

It has not been a quiet summer for investors in high-yield credit markets. The main reason for this has been the continued stress in commodity-related sectors. Recent downgrades of corporates, both sovereign-related in countries such as Brazil and Russia, and company-specific, in names such as Transocean, have resulted in the growth of the basic industry and energy sectors of the high-yield market. The changing composition of the BAML Global High Yield index highlights the significant increase in the risk contributions from these sectors compared to a year ago. On the duration times spre...