Leader Week in Review
December 8, 2014
Economic Data Releases:
Over the past week, the yield curve flattened with the front end shifting upward, the belly roughly flat and the long-bond down 5bps on the back of a very strong jobs report last Friday. Investment Grade credit spreads stabilized, albeit at higher levels, while High yield spreads continued upward. Investment Grade spreads have not been this high since November of last year, and high yield (except for the spike in October) haven't been this high since July of 2013 (see chart 1).
Moving to the blow-out jobs report, this puts year-to-date jobs growth easily ahead of every other year since 1999, and the 6th strongest jobs growth YTD in the past 24 years (see chart 2). With the economy generating these kinds of numbers and credit spreads at levels not seen for a year or more, the corporate market looks like a good value.
Upcoming Economic Data Releases: