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High Yield Stalls

Published Sat, 09 Feb 2019 02:06:57 -0500 on Seeking Alpha

Just like the broader market this week, the rally in high yield credit stalled out a bit. Earlier on Friday, we highlighted the fact that the S&P 500 ran into resistance right at its 200-DMA earlier this week and has been pulling back ever since. In the case of the ETF that tracks the high yield credit market (HYG), we have seen a similar setup. Coming off the lows in December, high yield was a little bit late to the rally, but it quickly made up any lost ground and has since followed the move in the S&P 500 step for step. In fact, this week, HYG even managed to briefly trade above its 200-DMA. In this case, though, HYG ran out of momentum pretty much right at the same spot (~$85) where recent bounce attempts also ran out of steam.
The fact that these rallies in both high yield and the broader equity market are stalling outright at key moving averages is no doubt a focus of technicians, but given the magnitude of the moves off the lows, they had to take a break at some point, so why not at a point where everyone was expecting it. The only test now is whether there are enough bids below current levels to support the market, or will sellers eventually overwhelm the balance.

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
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Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
CS HIGH YIELD BOND FUND 2.35   0.0 0.00 0.00 9.83
MFS INTERMEDIATE HIGH INCOME FUND 2.42   0.0 0.00 0.00 9.78
WELLS FARGO ADV INCOME OPP FUND 7.79   0.0 0.00 0.00 9.21
PIONEER HIGH INCOME TRUST 8.78   0.0 0.00 0.00 9.18
CREDIT SUISSE ASSET MANAGEMENT INCOME FUND 2.97   0.0 0.00 0.00 9.09
ARES DYNAMIC CREDIT ALLOCATION FUND 14.94   0.0 0.00 0.00 8.62
WA HIGH INCOME FUND II 6.37   0.0 0.00 0.00 8.57
BLACKROCK CORPORATE HIGH YIELD FUND VI 10.14   0.0 0.00 0.00 8.52
BLACKROCK DEBT STRATEGIES FUND 10.63   0.0 0.00 0.00 7.77
FIRST TRUST STRATEGIC HIGH INCOME FUND II 12.35   0.0 0.00 0.00 7.77
MASSMUTUAL CORP INV 15.73   0.0 0.00 0.00 7.69
NEUBERGER BERMAN HIGH YIELD STRATEGIES FUND 11.04   0.0 0.00 0.00 7.15
SPDR BARCLAYS CAPITAL HIGH YIELD BOND ETF 35.50   0.0 0.00 0.00 5.59
ISHARES IBOXX $ HIGH YIELD CORPORATE BOND FUND 85.43   0.0 0.00 0.00 5.46

CS HIGH YIELD BOND FUND - DHY
CS HIGH YIELD BOND FUND - DHY  


Older articles featuring Cs High Yield Bond Fund (DHY):
Weekly Review: High-Yield CEFs - CIK Is 9.09% Yielder With A Relatively Low Z-Score And Duration
Weekly Review: High-Yield CEFs - KIO Offers 9.80% Yield And One Of The Lowest Durations
High Yield: The Comeback Kid
Can A High-Yield Allocation Still Offset Equity Volatility?
Weekly Review: High-Yield CEFs - HNW Offers 8.24% Yield Accompanied By One Of The Highest Discounts
High-Yield Quality Control
High Yield Spreads: When Crashing Is A Good Thing
Are High-Yield Municipal Bonds 'High Yield' Or 'Junk'?
Weekly Review: High-Yield CEFs - BGH Offers The Highest Yield In The Sector
Weekly Closed-End Fund Roundup: JQC Boosts Yield To 16%

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