Yahoo Finance US Stock Indices Rose as Oil Prices Rebounded
Why Was Junk Bond Issuance Slower Last Week?
US stock indices rose
The three US equity indices that we review in this weekly series rose from April 13 to April 20, 2016, after a rebound in oil prices. Upbeat existing home sales data provided additional support. The S&P 500 index, tracked by the Vanguard 500 Index Fund Investor Class (VFINX), rose 1.0%. The Dow Jones Industrial Average (DJIA) rose 1.1%. The NASDAQ was almost flat. The S&P 500 index is also tracked by the SPDR S&P 500 ETF (SPY). It was up by 1.0% for the same period.
Oil tracking ETFs like the United States Oil Fund (USO) and the ProShares Ultra Bloomberg Crude Oil ETF (UCO) rose. Companies such as Chesapeake Energy (CHK), Chevron (CVX), and Devon Energy (DVN) rallied.
Housing data
Existing home sales rose 5.1% to a seasonally-adjusted annual rate of 5.33 million in March—up from a downwardly revised 5.07 million in February. The rise was mainly due to the low inventory of homes that has been driving prices upward. March sales rose 1.5% from a year ago.
Meanwhile, housing starts fell 8.8% month-over-month in March at a seasonally adjusted annual rate of 1.089 million units. New building permits fell 7.7% month-over-month to 1.086 million units.
Junk bonds
Junk bond yields fell sharply by 39 basis points week-over-week and ended at 7.9% on April 15, 2016—the lowest since November 18, 2015. Due to a fall in yields, the price of mutual funds and ETFs investing in junk bonds like the American Funds American High-Income Trust – Class A (AHITX), the T. Rowe Price High Yield Fund – Advisor Class (PAHIX), the SPDR Barclays Capital High Yield Bond ETF (JNK), and the iShares iBoxx $ High Yield Corporate Bond Fund (HYG) rose in the week ending April 15.
This series will cover developments in the primary and secondary markets for high-yield debt and leveraged loans. We’ll start with developments in the high-yield primary market issuance.
Browse this series on Market Realist:
