Insight – Page 2 – Cincinnati Asset Management

13 Mar 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads were meaningfully wider this week through Thursday, though the tone was positive with tighter spreads on Friday morning. The OAS on the Corporate Index closed at 90 on Thursday March 12^th after closing the week prior at 83. The 10yr Treasury ended last week at 4.14% and it closed at 4.26% on Thursday evening. Through Thursday, the Corporate Bond Index year-to-date total return was -0.69% and the yield to maturity for the index was 5.11%. It is worth noting that this week was the first time the corporate index yield closed above 5% since the last trading day of July 2025.

Points of Interest

It was another volatile week for risk assets as the conflict with Iran looks as though it could drag on for quite some time. The implication for oil prices has been profound which has led to higher expectations for inflation and lower expectations for consumer spending. There were some meaningful economic releases this week with Personal Income/Spending and Core PCE. These were mostly in line with expectations but the problem is that this data was for the month of January and backward looking in nature. It will be months before we know the full extent of the impact that higher energy prices will have on the economy. Next Wednesday the FOMC will convene and deliver a decision on the policy rate. Interest rate futures are pricing an extremely high probability that the Fed maintains the status quo. In fact, futures are not even pricing in a one full 25bp cut for the entirety of 2026. Expectations can evolve rapidly but we believe that the Fed is on hold for the foreseeable future.

Primary Market

New issue supply was the big story of the week in the credit markets as issuers priced $115bln of new debt versus the estimate of $60bln. It was the second busiest week on record, just trailing the $117bln that was priced in 2020. Amazon, Honeywell and Salesforce led the way with three jumbo deals that accounted for $78bln of the total. Amazon’s $37bln deal on Tuesday was the 4^th largest of all time and helped reach a new daily record for the US primary market of $65.75bln. Remarkably, Amazon returned to market in Europe on Wednesday pricing €14.5 billion, the largest bond deal ever for that currency. Syndicate desks are looking for around $40bln of issuance next week. Year-to-date new issue supply stood at $565bln through the end of the week.

Flows

According to LSEG Lipper, for the week ended March 10^th, short and intermediate investment-grade bond funds reported a net inflow of +$3.28bln. This was the 15^th consecutive week of inflows. 2026 year-to-date flows into investment grade were +$36.5bln.

This information is intended solely to report on investment strategies identified by Cincinnati Asset Management. Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. This material is not intended as an offer or solicitation to buy, hold or sell any financial instrument. Fixed income securities may be sensitive to prevailing interest rates. When rates rise the value generally declines. Past performance is not a guarantee of future results.

06 Mar 2026

High Yield Weekly, Insight Rich Balestra - Portfolio Manager 0 comment

CAM High Yield Weekly Insights

(Bloomberg) High Yield Market Highlights

US junk bonds will take their cue from key employment and retail sales data Friday amid broader market angst tied to Iran war
Meanwhile, issuance of new junk notes has slowed to a trickle
Thursday saw one deal enter the market, a $250 million tap from NGL Energy, but that offering was subsequently dropped as a concurrent leveraged-loan offering was upsized by that amount
High-yield bonds have posted losses on five of the last six sessions, and the market is at risk of its first back-to-back weekly declines in four months, according to data compiled by Bloomberg

(Bloomberg) US Unexpectedly Sheds 92,000 Jobs, Unemployment Rate Rises

US employers unexpectedly cut jobs in February and the unemployment rate rose, pointing to lingering fragility in a labor market that was thought to be stabilizing.
Nonfarm payrolls decreased 92,000 last month after a strong start to the year, according to Bureau of Labor Statistics data out Friday. The unemployment rate climbed to 4.4%. The decline in payrolls — which was one of the largest since the pandemic — partly reflected a decrease in health care employment due to strike activity.
The report calls into question whether the labor market is actually steadying after the worst year for hiring outside of a recession in decades. While job growth jumped in January and unemployment insurance claims have settled at a low level, companies may be starting to follow through on a series of previously announced layoffs.
And a recent trend in productivity gains illustrates how spending on artificial intelligence has allowed some firms to get by with leaner staffing.
“The idea the labor market has turned a corner implodes with this report,” Samuel Tombs, chief US economist at Pantheon Macroeconomics, said in a note.
The figures could refocus the Federal Reserve’s attention on the jobs market as it assesses how long to hold interest rates steady. Policymakers have been more attuned to inflation lately — even before the US-Israeli war on Iran sparked concerns among investors about price pressures.
In an interview on CNBC following the report, San Francisco Fed President Mary Daly said, “The hopes that the labor market was steadying, maybe that was too much, and we really have to keep our eye on the labor market.”

(Bloomberg) US Retail Sales Fell in January on Fewer Vehicle Purchases

US retail sales declined in January, restrained by weakness at auto dealers as winter weather-related disruptions tempered some activity.
The value of retail purchases, not adjusted for inflation, decreased 0.2% after no change in December, Commerce Department data showed Friday. Excluding car dealers, sales were little changed.
Seven out of 13 categories posted decreases. Motor vehicle sales dropped 0.9%, while receipts at apparel merchants, gas stations and health and personal care stores also declined.
The report showed a 0.3% increase in so-called control-group sales — which feed into the government’s calculation of goods spending for gross domestic product. The measure excludes food services, auto dealers, building materials stores and gasoline stations.
More modest overall retail spending at the turn of the year has been accompanied by worries about the job market and cost of living. While wealthier households have the wherewithal to purchase non-essential goods, middle- and lower-income consumers may be growing more cautious.
Walmart Inc., a bellwether for the economy, last month forecast less earnings growth this year than expected.
A lengthy winter storm that included significant snowfall and ice across the central and eastern US likely impeded shoppers during the weather event. The Arctic blast triggered the most flight cancellations since the pandemic and left more than 1 million homes and businesses without power.
Receipts at restaurants and bars, the only service-sector category in the retail report, declined 0.2% in January. Restaurants including Sweetgreen Inc. and Chipotle Mexican Grill Inc. said that sub-freezing temperatures and winter storms hindered sales.

06 Mar 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads inched tighter this week on the back of strong demand. Investors were motivated by a flight to quality and higher all-in yields. The OAS on the Corporate Index closed at 81 on Thursday March 5^th after closing the week prior at 84. Spreads are wider as we go to print on Friday morning as a result of a weak payroll report for the month of February so it is possible that the index finishes the week close to unchanged if the current trend holds. The 10yr Treasury ended last week at 3.94% and it closed at 4.14% on Thursday evening. Treasuries were volatile this week but generally higher across the board as investors anticipated inflationary impacts due to sharply higher oil prices as a result of the ongoing conflict in the Middle East. Through Thursday, the Corporate Bond Index year-to-date total return was +1.36% and the yield to maturity for the index was 4.88%.

Points of Interest

Volatility took center stage this week as investors gauged the severity and potential duration of the conflict with Iran and AI-related worries continued to weigh on certain sectors of the market. Most commodity prices are now sharply higher with WTI and Brent crude both near $90/bbl (+50% YTD). Monday and Tuesday corporate bond volume was well above average, especially for IG credit as investors were seeking safety and yield. The big economic data this week did not hit until Friday morning with the payroll report and retail sales for the month of February. Payrolls were extremely underwhelming with a -92k reduction for the month relative to a survey of +55k jobs added. Some of the payroll weakness could be related to poor weather and ongoing labor strikes but it was a weak print any way you slice it and took the shine off January’s relatively good report (+126k revised vs +65k estimate). Retail sales on the other hand came in a bit better than expectations, especially considering the poor weather across most of the US during February. The headline number was -0.2% vs the -0.3% survey but the control group showed modestly positive sales growth of +0.4%.

Primary Market

New issue supply hit >$50bln again this week but fell short of the $70bln estimate. Issuers took a breather on Monday and Tuesday due to spread and rate volatility but then returned in a big way on Wednesday and Thursday. All told it was a respectable week from a volume perspective considering the bulk of that occurred over the course of just two trading days. Syndicate desks are looking for around $60bln of issuance next week. Year-to-date new issue supply stood at $450bln through the end of the week.

Flows

According to LSEG Lipper, for the week ended March 3^rd, short and intermediate investment-grade bond funds reported a net inflow of +$1.88bln. This was the 14^th consecutive week of inflows. 2026 year-to-date flows into investment grade were +$33.2bln.

27 Feb 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads moved wider this week. The OAS on the Corporate Index closed at 82 on Thursday February 26^th after closing the week prior at 77. The 10yr Treasury closed last week at 4.08% and had closed at 4.0% on Thursday before breaching 4% on Friday morning. If the current level holds, today will be the first time the 10yr has closed below 4% since the end of November. Through Thursday, the Corporate Bond Index year-to-date total return was +1.36% while the yield to maturity for the index was 4.75%.

Points of Interest

There was a lot happening in the market this week as AI-related woes continued to weigh heavily on certain sectors of the equity market, with software companies leading the way lower. The equity malaise, along with geopolitical worries surrounding Iran, sparked a flight to quality which sent Treasury yields lower. Next week investors will receive important economic data including Employment and Retail Sales from USA and Europe. We also get US ISM Services and a flurry of earnings reports from major retailers (COST, TGT) that will help investors gauge the pulse of the American consumer.

Primary Market

New issue supply sailed past the $50bln estimate this week as companies priced more than $63bln in the primary market. Although spreads have moved wider they have not fully offset the move lower in Treasuries making the funding environment incrementally more attractive for would be issuers. Next week is expected to be another big one as syndicate desks are looking for $70bln of new debt. Year-to-date new issue supply stood at $399.6bln through the end of the week.

Flows

According to LSEG Lipper, for the week ended February 25^th, short and intermediate investment-grade bond funds reported a net inflow of +$1.75bln. This was the 13^th consecutive week of inflows, although it was less volume than the past few weeks. 2026 year-to-date flows into investment grade were +$31.3bln. The pace of flows is double the number of YTD flows to this point in 2025.

13 Feb 2026

High Yield Weekly, Insight Rich Balestra - Portfolio Manager 0 comment

CAM High Yield Weekly Insights

(Bloomberg) High Yield Market Highlights

US junk bonds tumbled, yields rose and risk premiums surged as anxieties over artificial intelligence boiled over, causing a broad reassessment of riskier assets. Yields jumped the most in three weeks to 6.63% and spreads widened the most in four months to 275 basis points.
The selloff extended across ratings. CCC yields approached 10% after the biggest one-day increase in 10 months. Spreads rose 27 basis points to close at the year-to-date high of 616 basis points.
Single B spreads closed at 302, a more than two-month high. Yields climbed to approach 7%
The broad selloff started mid-week after a stronger-than-expected jobs report dashed hopes of Fed rate cuts
The primary market paused on Thursday, with just one deal pricing
A stable labor market and relatively strong corporate balance sheets kept the primary market busy earlier in the week; February volume is above $12b
Four borrowers priced more than $4b on Wednesday, the busiest single-day volume in three weeks

(Bloomberg) US Adds 130,000 Jobs and Unemployment Falls After Tepid 2025

US payrolls rose in January by the most in more than a year and the unemployment rate unexpectedly fell, suggesting the labor market continued to stabilize at the start of 2026.
Employers added 130,000 jobs last month and the unemployment rate declined to 4.3%, according to Bureau of Labor Statistics data out Wednesday. That followed revisions to the prior year, which showed a marked slowdown in hiring. Job gains averaged just 15,000 a month last year, down from the initially reported 49,000 pace.
The report suggests the labor market is finding its footing after the most anemic year for hiring outside of a recession since 2003. While economists expect hiring to remain generally sluggish in 2026, more clarity around the impact of President Donald Trump’s economic policies and lower borrowing costs could encourage some employers to boost headcount.
The January data reinforces Federal Reserve officials’ inclination to keep interest rates on hold for now. Many traders appeared to push out their timeline for the next rate cut to July from June.
In leaving rates unchanged last month, Chair Jerome Powell cited signs of steadying in the job market.
“Coming off of a hiring recession in 2025, this is welcome news,” said Heather Long, chief economist at Navy Federal Credit Union. “I think Fed Chair Powell was right — the labor market appears to be stabilizing.”
With the release of each January employment report, BLS benchmarks payrolls to a more accurate but less timely series called the Quarterly Census of Employment and Wages. That data is based on state unemployment insurance tax records and covers most US jobs.
That adjustment showed job growth was nearly 900,000 lower in the 12 months through March 2025 than initially reported. The figure roughly aligned with what the BLS’s preliminary estimate suggested.
The pickup in January hiring was led by health care, which added the most jobs since 2020 and accounted for the majority of overall job growth in 2025. Federal government payrolls continued to decline.
“It’s great that health care is growing the way it is, but I would feel much better if we were seeing broader strength,” said Laura Ullrich, director of economic research at Indeed Hiring Lab. “It is quite lopsided growth.”
Though layoffs remain generally constrained, there’s been a wave of job-cut announcements by companies like Amazon.com Inc. to United Parcel Service Inc. in recent weeks. And heading into this year, job openings across the economy dropped to the lowest level since 2020.
The jobs report is comprised of two surveys, one of businesses — which produces the payrolls figures — and another of households, which is the source of the unemployment rate. Within the household survey, the participation rate — the share of the population that is working or looking for work — edged up to 62.5% in January.
Wednesday’s release also included widespread revisions to the employer survey. With the release of the January 2026 data, the BLS updated its so-called birth-death model, which accounts for the net number of businesses opening and closing. Economists have noted this change should improve the model’s responsiveness to current economic conditions and reduce the size of benchmark revisions over time.
Adjustments to job numbers have been bigger than usual in recent years, which some economists attribute to unique post-pandemic dynamics.
While the January jobs report usually incorporates new population estimates from the Census Bureau into the household survey, those figures were delayed by a month due to last year’s record-long government shutdown.

13 Feb 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads drifted wider this week and the tape is somewhat weak on Friday morning. The AI disruption trade was in full force during the period throughout the equity markets and some portions of the leveraged loan and high yield credit markets, while IG credit remained relatively unscathed. The OAS on the Corporate Index closed at 77 on Thursday February 12^th after closing the week prior at 75. Recall that the index stood at 78 at the beginning of 2026. The 10yr Treasury closed last week at 4.21% and had closed at 4.10% on Thursday. The 10yr is wrapped around 4.06% as we go to print on the back of Friday’s cooler than expected CPI print. Through Thursday, the Corporate Bond Index year-to-date total return was +1.08% while the yield to maturity for the index was 4.77%.

Points of Interest

There were two economic releases of great interest this week. On Wednesday the delayed non-farm payroll report for the month of January showed much better job growth than expected with 130k jobs adding during the period relative to expectations of 65k. The unemployment rate also ticked lower for the second consecutive month down to 4.3% versus the survey of 4.4%. However, there was some bad news as well with the release of the BLS’s revised employment numbers for the full year 2025. The revision was over 400,000 lower taking the total number of jobs added during the prior year to just 181,000. This is an average of just over 15k jobs added per month in 2025 which is a weak number any way you slice it. The labor market is not yet bad but is has increasingly become a “low hire low fire” environment and it has clearly lost some steam over the past 24 months. The good news is that wages have continued to be supportive of consumer spending.

On Friday morning the CPI report offered a positive surprise in terms of inflation. For the month of January YoY CPI moved from +2.7% in the prior period down to +2.4% while economists were looking for +2.5%. This sparked a small rally in Treasuries sending yields lower though part of the move in rates could be related to the malaise in the equity markets this week as it pertains to the AI pain trade.

Primary Market

The primary market was on the screws this week as $40bln in new debt priced which also happened to be the consensus estimate. We had thought we would need a hyperscaler to print a deal in order to reach that number and this is precisely what happened as Alphabet came to market with a $20bln deal that accounted for half of the weekly calendar. Next week syndicate desks are looking for $25bln in new supply but we would not be surprised to see this number eclipsed if Treasuries hold current levels. Year-to-date new issue supply stood at $309bln through the end of the week.

Flows

In what has been a recurring theme, it was another robust week of inflows. According to LSEG Lipper, for the week ended February 11, short and intermediate investment-grade bond funds reported a net inflow of +$4.32bln. This was the 11^th consecutive week of inflows. 2026 year-to-date flows into investment grade were +$25.2bln. This is double the number of YTD flows to this point in 2025.

30 Jan 2026

High Yield Weekly, Insight Rich Balestra - Portfolio Manager 0 comment

CAM High Yield Weekly Insights

(Bloomberg) High Yield Market Highlights

US junk bonds stalled for a third straight session as yields climbed after data showed consumer confidence collapsed to its lowest level in more than a decade. A measure of consumer sentiment on present conditions slid to a five-year low, reinforcing concerns about a potential economic slowdown. The market racked up the biggest one-day loss in eight sessions.
The declines gained momentum after Chair Jerome Powell signaled that the Federal Reserve is prepared to keep rates on hold for an extended period. The markets do not expect any rate cuts before June. However, Bloomberg economist Anna Wong suggests that data developments will cut short any pause and the Fed will reduce rates by 100 basis points this year.
While the market rally lost its momentum this week, pushing yields modestly higher and spreads wider, the primary market rushed to take advantage of still-low risk premiums, attractive yields and strong demand
The overall economic picture is constructive, though the sentiment is weak, Barclays strategists Brad Rogoff and Dominique Toublan wrote on Friday
Three new deals priced a total of $2.5b on Thursday, driving the month’s volume to nearly $28b. At close of business today, the issuance volume will close the month at $30b to make it the second busiest January since 2021. It will be the busiest month for supply since September
The primary calendar is still pretty crowded

(Bloomberg) Fed Holds Rates as Window for Another Powell Cut Begins to Close

Jerome Powell has two more opportunities to adjust interest rates before his term as Federal Reserve chair ends — and he may not need them.
After the Fed kept borrowing costs on hold Wednesday, Powell talked up a “clear improvement” in the US outlook and said the job market shows signs of steadying. It signals a cautious optimism: Fed officials delivered three cuts last fall, and see nothing in the latest data to suggest more are needed to prop up the economy. Futures markets expect no shift in rates before June.
By then, Powell’s term as chair will have ended and a new one should be in place — likely opening another phase of President Donald Trump’s campaign for lower rates, which has upended the Fed over the past year. In a potential sign of what’s coming, the only two officials who voted for another cut this week were Governor Stephen Miran — on leave at the Fed from his post as a top Trump aide — and Governor Christopher Waller, one of four names on Trump’s shortlist of potential Powell successors.
“The window for a cut under a Powell-led Fed is essentially closed,” said Stephanie Roth, chief economist at Wolfe Research. “He is more optimistic about the labor market and economy overall than he was.”
The Federal Open Market Committee voted 10-2 Wednesday to hold the benchmark federal funds rate in a range of 3.5%-3.75%. Waller and Miran dissented in favor of a quarter-point reduction. Officials dropped language pointing to increased downside risks to employment that had appeared in the three previous statements.
Numbers published since the Fed’s December meeting point to accelerating growth, cooling inflation and steadying employment.
“The outlook for economic activity has improved, clearly improved since the last meeting, and that should matter for labor demand and for employment over time,” Powell told reporters Wednesday.
That upgraded assessment of the labor market is likely to hold expectations for a near-term rate cut at bay, despite escalating pressure from the Trump administration. Still, Powell was at pains not to overstate the improvement in the labor market. While it’s shown signs of stabilizing, “I wouldn’t go too far with that,” he said.
Fed watchers said the mixed messaging suggests policymakers want to keep their options open.
“You could get whiplash from the various descriptions,” said Tim Mahedy, a former senior adviser at the Federal Reserve Bank of San Francisco.
On inflation, Powell said the overall story was “modestly positive,” despite his estimate that the Fed’s favored gauge ended 2025 at 3%, a full percentage point above target.
“Most of the overshoot was in goods prices, which we think is related to tariffs,” he said. “We think those will not result in inflation, as opposed to a one-time price increase.”

(Bloomberg) Trump Picks a Reinvented Warsh to Lead the Federal Reserve

News out Friday morning…
President Donald Trump said he intends to nominate Kevin Warsh to be the next chair of the Federal Reserve.
Warsh, who served on the US central bank’s Board of Governors from 2006 to 2011 and has previously advised Trump on economic policy, would succeed Jerome Powell when his term at the helm ends in May, if confirmed by the Senate.
Warsh is currently an adviser at Stanley Druckenmiller’s Duquesne Family Office, a fellow at the conservative Hoover Institution think tank and a lecturer at Stanford Business School.

This information is intended solely to report on investment strategies identified by Cincinnati Asset Management. Opinions and estimates offered constitute our judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. This material is not intended as an offer or solicitation to buy, hold or sell any financial instrument. Fixed income securities may be sensitive to prevailing interest rates. When rates rise the value generally declines. Past performance is not a guarantee of future results.

30 Jan 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads remained range bound this week with The Index just slightly wider through Thursday. The OAS on the Corporate Index closed at 73 on Thursday January 29^th after closing the week prior at 72. The 10yr Treasury closed last week at 4.23% and exhibited almost no change whatsoever throughout the week before closing at 4.23% on Thursday evening. Through Thursday, the Corporate Bond Index year-to-date total return was +0.24% while the yield to maturity for the index was 4.85%.

Points of Interest

The biggest news of the week came on Friday morning when President Donald Trump said that he intends to nominate Kevin Warsh to be the next chair of the Federal Reserve. Warsh still needs to be confirmed by the Senate but he is widely viewed as a relatively safe pick given his past experience serving on the US Central Bank’s Board of Governors from 2006 to 2011. Recall that Jerome Powell’s term expires in May.[i]

The FOMC also met this week and made no changes to its policy rate, as expected. This pause came after three consecutive meetings where the committee elected to lower rates. 10 of the 12 voting members chose to pause with only 2 dissenters that were in favor of lower rates.

This creates a tough situation for Kevin Warsh and we are not envious of the job that he has in front of him. On one hand he has a President that has repeatedly called for a policy rate up to 3% lower than its current level (this would be the equivalent of a dozen 25bp rate cuts!). On the other hand, Warsh inherits an economy that has continued to perform and a job market that has experienced slowing growth but has still managed to maintain an unemployment rate that has shown signs of stabilization near historical lows. With the December dot plot showing a median consensus of just two cuts by the end of 2027 it is hard to envision a scenario where Kevin Warsh will be able to deliver lower rates and appease the President. In any case, we are hopeful that the Fed continues its time-honored tradition of independence and allows the data to guide its decision-making process.

There is a smattering of economic data next week but the major highlights are JOLTS job data on Wednesday followed by the Nonfarm Payroll report on Friday morning.

Primary Market

The primary market picked up this week as borrowers priced $36.9bln of new debt topping the high end of estimates. This helped push the monthly total for January to $208bln, making it the 5^th busiest month of all-time. Syndicate desks are looking for another busy week to start the month of February with the average supply estimate coming in at around $40bln.

Flows

Investment grade bond inflows hit a five-year high in the latest week. According to LSEG Lipper, for the week ended January 28, short and intermediate investment-grade bond funds reported a net inflow of +$5.4bln, the most since the week ended February 3^rd, 2021. This was the 9^th consecutive week of inflows. 2026 year-to-date flows into investment grade were +$14.46bln.

[1] Bloomberg, January 30 2026, “Trump Picks a Reinvented Warsh to Lead the Federal Reserve”

23 Jan 2026

Insight, Investment Grade Weekly Josh Adams - Portfolio Manager 0 comment

CAM Investment Grade Weekly Insights

Credit spreads moved tighter this week. The OAS on the Corporate Index closed at 71 on Thursday January 22^nd after closing the week prior at 74. The Index was 7 bps tighter YTD and stood at its tightest level since 1998 amid a strong technical backdrop for credit. The 10yr Treasury closed last week at 4.22% before moving to 4.25% on Thursday evening. The benchmark rate was 8bps higher YTD. Through Thursday, the Corporate Bond Index year-to-date total return was +0.26% while the yield to maturity for the index was 4.86%.

Points of Interest

The data this week was supportive of a resilient economy. GDP and personal consumption were healthy. Core PCE for the month of November remained above the Fed’s long-term target (2%) but it ticked lower from the month prior with no surprises to the upside. This is backward looking data but it has led market participants to coalesce around the belief that the economy is poised to perform well in 2026. The strong economic data has caused prognosticators to carefully consider the Fed’s need to decrease its policy rate in the year ahead. The median projection derived from the Fed’s December dot plot showed just one cut in 2026 with an additional single cut in 2027. The market started the year with a hunger for 2+ cuts year but interest rate futures were pricing slightly less than two cuts as of Friday afternoon. Economic stimulus associated with the recently enacted tax reform as well as the performance of the job market will be the two items that have the biggest impact on the policy rate in 2026 in our view.

There are a handful of economic releases next week but the highlight will be the FOMC on Wednesday. Fed fund futures are currently predicting almost no chance of a cut/raise and we agree. The more interesting story could be President Trump revealing his preferred choice for the new Fed Chair. He has consistently said that the announcement would occur in the month of January. We would not be surprised if this news were to hit the tape at the conclusion of next Wednesday’s FOMC release.

Primary Market

The primary market was slower this week as earnings season continued to progress with many issuers still prohibited from bringing new deals due to quiet periods. Through Thursday, $20.4bln in new debt was priced with a regional bank deal pending on Friday that will add $1.75bln to that total. More than $170bln of new debt has been priced so far in 2026, with much of that total ($90.2bln) coming in the first full week of the year, which ended up as the 4^th busiest week of all-time. The Fed meeting should lead to a front-end loaded calendar in the week ahead. Dealers are looking for $35bln of new debt next week which would push the monthly total north of $200bln.

Flows

Demand for credit has been strong to start the year. According to LSEG Lipper, for the week ended January 21, short and intermediate investment-grade bond funds reported a net inflow of +$3.09bln. This was the 8^th consecutive week of inflows dating back to last year. 2026 year-to-date flows into investment grade were +$9.60bln.

23 Jan 2026

Insight, Investment Grade Quarterly CAM Team 0 comment

Comentario del cuarto trimestre y perspectivas para 2026

Comentario del cuarto trimestre y perspectivas para 2026
Enero de 2026

El crédito con grado de inversión registró fuertes rendimientos en 2025 gracias a diferenciales más estrechos, rendimientos decrecientes de los bonos del Tesoro y generación de ingresos. Los ingresos por cupones se impusieron y representaron más de la mitad del rendimiento total del índice. La economía siguió creciendo a lo largo del año, incluso en medio de la volatilidad relacionada con los aranceles y las preocupaciones de los inversores por la desaceleración del mercado laboral.

2025 en retrospectiva

Durante 2025, el diferencial ajustado por opciones (OAS) del índice Bloomberg US Corporate Bond (el Índice) se redujo en 2 puntos básicos hasta situarse en 78, tras comenzar el año en 80. El índice OAS cerró con una amplia diferencia de 119 a principios de abril tras los aranceles del Día de la Liberación, pero el movimiento al alza fue efímero y el Índice volvió a situarse por debajo de 100 a principios de mayo. El crédito de menor calidad superó modestamente al de mayor calidad debido a los cupones cada vez más altos que se ofrecen en el mercado a medida que disminuye la calidad. El crédito a mediano plazo superó al crédito a más largo plazo, ya que los rendimientos de los bonos del Tesoro a corto y mediano plazo disminuyeron a lo largo del año.

Si analizamos las principales industrias, las tres de mejor desempeño en el índice en 2025 desde una perspectiva de rendimiento total fueron la metalúrgica y minera, la aeroespacial y de defensa, y la tabacalera. Las tres industrias con peor desempeño fueron las de medios de comunicación, entretenimiento, ocio y productos químicos. No hubo industrias con un rendimiento total negativo.

Los rendimientos más bajos de los bonos del Tesoro fueron una bendición para el rendimiento de los bonos con grado de inversión intermedio en 2025. Los bonos del Tesoro a 2, 5 y 10 años cerraron el año con una caída de 77, 66 y 40 puntos básicos, respectivamente. No sorprende que los rendimientos de los bonos del Tesoro a corto plazo disminuyeran junto con la decisión del FOMC de reducir su tasa de política en 75 puntos básicos en la segunda mitad del año. Por otro lado, los bonos del Tesoro a 30 años se mantuvieron obstinadamente elevados, y cerraron el año 6 puntos básicos por encima de donde comenzaron. Recordemos que la Estrategia de Grado de Inversión de CAM es un programa de vencimiento intermedio que no invierte en valores con vencimientos a más largo plazo ni realiza anticipaciones de tasas de interés. En nuestra opinión, es simplemente demasiado difícil predecir con precisión las tasas de interés a largo plazo, especialmente en los extremos más lejanos de la curva.

Perspectivas para el 2026

Hay varios temas importantes y preguntas directas que estamos observando a medida que pasamos la página hacia el año que comienza.

¿Quién será el próximo presidente de la Reserva Federal? El mandato de Jerome Powell como presidente expira en mayo y el presidente Trump ha dicho que podría anunciar su sustituto en enero.ⁱ Según el creador de mercado de predicciones Polymarket, es una carrera reñida entre Kevin Hassett y Kevin Warsh. Si bien ambas opciones probablemente serían aceptables para los mercados financieros, existen algunas diferencias clave. Warsh tiene más experiencia, ya que se desempeñó como gobernador de la Reserva Federal entre 2006 y 2011, mientras que Hassett es considerado más moderado y menos independiente debido a sus estrechos vínculos con el presidente Trump como asesor económico. Tampoco podemos descartar la posibilidad de que Trump nomine a alguien totalmente inesperado, lo que podría tener repercusiones en los activos de riesgo.

Estímulo monetario: ¿cuántos recortes habrá en 2026? El pronóstico medio del último gráfico de puntos de la Reserva Federal mostró una expectativa de solo un recorte de tasas de 25 puntos básicos el próximo año. Esto contrasta con las expectativas de los inversores, que estiman reducciones de la tasa de política monetaria por un valor de 58 puntos básicos antes de fin de año.ⁱⁱ Aquí en CAM, actualmente nos inclinamos por dos recortes de 25 puntos básicos. Aunque se supone que la Reserva Federal debe mantener su independencia, debemos reconocer la intensa presión que ejerce la Casa Blanca en favor de políticas acomodaticias, así como la capacidad del presidente para nombrar a un presidente que, en su opinión, se ajustará a su objetivo de bajar las tasas. Nos resulta difícil prever más de dos recortes debido a la magnitud del estímulo fiscal que experimentará la economía en 2026, lo que nos lleva a nuestra siguiente preocupación.

Estímulo fiscal: ¿repitiendo errores del pasado? La Ley One Big Beautiful Bill se aplica retroactivamente a las declaraciones de impuestos de 2025, por lo que su impacto se sentirá a principios de 2026. Entre las disposiciones incluidas se encuentran la exención fiscal de las propinas, la exención fiscal de las horas extras, la exención fiscal de los intereses de los préstamos para la compra de automóviles y una deducción adicional para las personas mayores. La OBBBA también aumenta el límite máximo de la deducción fiscal estatal y local e incluye un aumento permanente del crédito fiscal por hijo. Muchos otros componentes de esta legislación son demasiado exhaustivos para tratarlos aquí, pero el efecto neto es que la mayoría de los contribuyentes recibirán devoluciones fiscales significativamente mayores a principios de 2026, lo que supondrá un importante estímulo económico. Aunque en principio esto es positivo para los contribuyentes, nos preocupa el impacto que tendrá sobre la inflación, que ya ha demostrado mantenerse por encima del objetivo a largo plazo del 2 % fijado por la Reserva Federal.

¿Seguirá deteriorándose el mercado laboral? El crecimiento mensual de la nómina se desaceleró a lo largo de 2025 y la tasa de desempleo alcanzó un máximo de cuatro años del 4.6 % en noviembre. Posteriormente, la tasa de desempleo descendió hasta el 4.4 % en diciembre, pero estuvo acompañada de un crecimiento anémico de las nóminas. Aunque el desempleo todavía es bajo según los estándares históricos, vemos pocas razones para que se repita la época de auge del mercado laboral. Se espera que el mercado laboral siga estando estancado en 2026, ya que las empresas se muestran cautelosas con sus planes de contratación debido a las presiones sobre los márgenes, la incertidumbre en torno a la política comercial y una continua disminución de trabajadores extranjeros. En nuestra opinión, un mercado laboral poco dinámico podría contribuir a atenuar algunos de los efectos del estímulo económico mencionado anteriormente.

¿Cómo afecta esto al crédito con grado de inversión?

Dado el perfil de riesgo más bajo y el riesgo de incumplimiento relativamente mínimo, no esperamos que los temas mencionados anteriormente tengan un impacto significativo en los diferenciales de crédito de forma aislada. Si el mercado laboral experimentara una caída precipitada que empujara a la economía a una recesión, entonces estarían virtualmente garantizados diferenciales de crédito más amplios, pero esto también desencadenaría una medida por parte de la Reserva Federal para bajar rápidamente las tasas de interés. De manera similar, si el estímulo fiscal y/o monetario da como resultado una economía al rojo vivo y las tasas de interés suben, eso restaría algo de impulso a los rendimientos totales con grado de inversión, pero cabría esperar que los diferenciales se redujeran aún más en un escenario de auge económico, lo que compensaría en parte el impacto negativo del aumento de las tasas. Nos sentimos cómodos con los rendimientos totales disponibles en el mercado, ya que proporcionan un margen de seguridad. Existen múltiples caminos para lograr rendimientos totales sólidos para la clase de activos de grado de inversión en el próximo año, independientemente de la gran cantidad de resultados económicos. Hay varias cuestiones específicas del mercado de grado de inversión que nos gustaría destacar.

Todo es cuestión de la oferta. 2025 fue el segundo año de mayor actividad registrado en términos de volumen del mercado primario (1.58 billones de dólares), solo superado por 2020 (1.75 billones de dólares), el último de los cuales fue impulsado por tasas de interés extraordinariamente bajas y préstamos inducidos por la COVID frente a la incertidumbre económica. Se proyecta que 2026 será el año de mayor actividad hasta el momento, con los sindicatos (los bancos que suscriben nuevas emisiones) proyectando una oferta de nuevos bonos de entre 1.8 y 2.25 billones de dólares.ⁱⁱⁱ De hecho, enero ya ha comenzado con fuerza, con 90 200 millones de dólares de deuda con grado de inversión emitidos en la primera semana completa del año, lo que la convierte en la cuarta semana más activa de todos los tiempos.^iv Hay tres factores que impulsan la avalancha de emisiones. En primer lugar, los hiperescaladores (META, GOOGL, AMZN, MSFT, ORCL) han aumentado el gasto de capital en la carrera por situarse a la vanguardia de la inteligencia artificial. Varias de estas empresas recaudaron más de 20 000 millones de dólares en nueva deuda durante 2025, y se prevé que la cifra aumente en 2026 y años posteriores. En segundo lugar, la actividad de fusiones y adquisiciones aumentó a finales de año y el entorno para la realización de acuerdos sigue siendo atractivo en 2026 debido a la financiación accesible y a un entorno regulatorio más relajado. Las fusiones y adquisiciones siempre son muy difíciles de predecir, pero solo se necesitan dos o tres operaciones importantes para que la situación cambie significativamente, y el volumen de las operaciones ha ido creciendo. Por último, los inversores crediticios se han mostrado más que dispuestos a conceder préstamos, ya que la demanda se ha mantenido fuerte y las entradas en esta clase de activos han sido sólidas. Esta es quizás la pieza más importante del rompecabezas. Esperamos que los posibles emisores de deuda “vendan cuando puedan”, siempre y cuando los participantes del mercado estén dispuestos a comprar a un precio razonable. Las empresas de alta escalabilidad y las compañías que participan en fusiones y adquisiciones a gran escala tienen una variedad de opciones para acceder a capital fuera de los mercados públicos de inversión en valores, incluidas la emisión de acciones, el crédito privado, los préstamos respaldados por activos y los préstamos. Es esta opcionalidad la que nos lleva a creer que la oferta no abrumará los mercados de crédito IG en 2026, ya que los prestatarios recurrirán a otras opciones si la emisión de deuda pública se vuelve prohibitivamente cara. Vimos este comportamiento por parte de META cuando emitió un instrumento de crédito privado por valor de 27 000 millones de dólares en octubre para financiar un proyecto de centro de datos a gran escala en Luisiana.

Los fundamentos son estables, pero el riesgo idiosincrásico está aumentando. Los indicadores crediticios máximos han quedado claramente atrás, pero la calidad crediticia fundamental del mercado de IG en general sigue siendo muy sólida. El sector bancario está a la vanguardia en términos de salud crediticia. El apalancamiento no financiero es elevado en relación con 2019, pero es significativamente menor que en 2021, mientras que la cobertura de intereses ha tendido a disminuir para la misma cohorte. En el lado positivo, el EBITDA siguió creciendo y los márgenes de EBITDA alcanzaron otro máximo histórico al final del tercer trimestre, liderados por créditos de gran capitalización y alta calificación.^v Lo que se pierde en estas cifras son los datos cualitativos que hemos observado recientemente en el mercado. Nuestra experiencia nos dice que el riesgo único en el mercado de IG ha ido aumentando en los últimos trimestres para determinadas industrias y créditos específicos. Los gestores exitosos deberán centrarse en crear carteras bien diversificadas y evitar a los prestatarios problemáticos. Nos sentimos cómodos abordando estos riesgos como gestores que se centran en las métricas crediticias individuales de los emisores que componen nuestra cartera.

La calidad del crédito está aumentando. A pesar de que los indicadores crediticios están por debajo de sus niveles máximos, la calidad del universo de grado de inversión ha aumentado en los últimos años. La composición BAA del índice alcanzó un máximo del 51.21 % a finales de 2018, pero esta cifra había caído al 45.77 % a finales del año pasado.

No solo existe una tendencia hacia emisiones de mayor calidad, con empresas con calificación A o superior que representan el 58 % de las emisiones en los últimos años, sino que también se registró un número récord de mejoras de calificación de BAA a A simple en 2025, mientras que las rebajas de calificación alcanzaron un mínimo histórico.^vi Esperamos que la calidad del índice pueda seguir aumentando durante los próximos años si los planes de gasto de capital en inteligencia artificial de alta escalabilidad altamente calificados se concretan. Recordemos que el Programa de Grado de Inversión de CAM tiene una ponderación estructuralmente inferior al crédito con calificación BAA, ya que buscamos limitar la exposición de la cartera a una ponderación del 30 % en las partes más riesgosas del mercado de IG.

El camino por delante

A medida que avanzamos en el calendario, nos volvemos cautelosos, pero no necesariamente temerosos. Los diferenciales de crédito son estrechos, al igual que a principios de 2025, y los rendimientos no son tan elevados como hace 12 meses, pero son lo suficientemente altos como para proporcionar un margen de seguridad. A medida que el ciclo crediticio ha ido madurando, el mercado se ha ido orientando cada vez más hacia un entorno de “selección de créditos”, en el que se premia a los gestores por evitar errores. Seguiremos centrándonos en los aspectos prácticos del trabajo crediticio y posicionaremos la cartera lo mejor posible para generar retornos atractivos ajustados al riesgo.

Esperamos que su año haya comenzado de manera excelente y esperamos continuar conversando con usted a lo largo de 2026.

Esta información solo tiene el propósito de dar a conocer las estrategias de inversión identificadas por Cincinnati Asset Management. Las opiniones y estimaciones ofrecidas están basadas en nuestro criterio y están sujetas a cambios sin previo aviso, al igual que las declaraciones sobre las tendencias del mercado financiero, que dependen de las condiciones actuales del mercado. Este material no tiene como objetivo ser una oferta ni una solicitud para comprar, mantener ni vender instrumentos financieros. El rendimiento pasado no es garantía de resultados futuros. El rendimiento bruto de la tarifa de asesoramiento no refleja la deducción de las tarifas de asesoramiento de inversión. Nuestras tarifas de asesoramiento se comunican en el Formulario ADV Parte 2A. En general, las cuentas administradas mediante programas de firmas de corretaje incluyen tarifas adicionales. Los retornos se calculan mensualmente en dólares estadounidenses e incluyen la reinversión de dividendos e intereses. El Índice no está administrado y no considera las tarifas de la cuenta, los gastos y los costos de transacción. Los rendimientos de los índices y los datos relacionados, como los rendimientos y los diferenciales, se presentan con fines comparativos y se basan en información generalmente disponible al público, proveniente de fuentes que se consideran confiables. No se hace ninguna afirmación sobre su precisión o integridad.

La información suministrada en este informe no debe considerarse una recomendación para comprar o vender ningún valor en particular. Los distintos tipos de inversiones implican distintos grados de riesgo y no puede garantizarse que cualquier inversión específica sea adecuada o rentable para la cartera de un cliente. Las inversiones de renta fija tienen distintos grados de riesgo crediticio, riesgo de tasa de interés, riesgo de incumplimiento y riesgo de prepago y extensión. En general, los precios de los bonos suben cuando las tasas de interés bajan y viceversa. Este efecto suele ser más pronunciado en el caso de los valores a largo plazo. No hay garantía de que los valores que se tratan en este documento hayan permanecido o permanecerán en la cartera de una cuenta en el momento en que reciba este informe o que los valores vendidos no se hayan vuelto a comprar. Los valores analizados no representan la cartera completa de una cuenta y, en conjunto, pueden representar solo un pequeño porcentaje de las tenencias de cartera de una cuenta. No debe suponerse que las transacciones de valores o participaciones analizadas fueron rentables o demostrarán serlo, o que las decisiones de inversión que tomemos en el futuro serán rentables o igualarán el rendimiento de la inversión de los valores examinados en este documento. Si se lo solicita, Cincinnati Asset Management proporcionará una lista de todas las recomendaciones de valores realizadas durante el último año.

En nuestro sitio web se encuentran disponibles las divulgaciones adicionales sobre los riesgos materiales y los posibles beneficios de invertir en bonos corporativos: https://www.cambonds.com/disclosure-statements/

ⁱ Bloomberg, 29 de diciembre de 2025, “Trump afirma que aún podría despedir a Powell ante la inminente elección del presidente de la Reserva Federal”
ⁱⁱ Bloomberg, 8 de enero de 2026, “Probabilidad de la tasa de interés mundial”
ⁱⁱⁱ Bloomberg, 2 de enero de 2026, “Se prevé un inicio masivo de ventas de bonos con grado de inversión en enero”
^iv Bloomberg, 8 de enero de 2026, “EMISIÓN DE BONOS DEL GOBIERNO DE EE. UU.: la semana supera los 90 000 millones de dólares, ya que tres emisiones recaudarán 1750 millones el jueves”
^v Barclays, 15 de diciembre de 2025, “Actualización del tercer trimestre de 2025: sin indicios de preocupación”
^vi Barclays, 7 de noviembre de 2025, “Todos a bordo del tren de la mejora de la calificación de BBB”

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