Credit Is Starting to Crack π The Chart Report
Chart of the Day
π Today's Chart of the Day was shared by Jim Carroll.
Investment Grade Corporate Bonds relative to 7β10 Year Treasuries (LQD/IEF) made new multi-month lows today and suffered its third-worst session since last Halloween.
When Treasuries begin to outperform corporate credit, it marks a shift toward safety and away from risk.
This suggests credit spreads are widening and financial conditions are tightening, which tends not to be the best environment for equities.
The Takeaway: Credit spreads are widening, and if the trend persists, itβs likely to act as a headwind for risk assets.
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