Weekly Market Commentary 10-20-25

“Bull Market Anniversary and Performance”
See what we have to say about the following:

 

 

 

• Cockroaches, Canaries, and Credit Markets:
  Subtle signs of stress are emerging in corporate credit markets, especially among lower-rated issuers, despite stability in investment-grade bonds.

 

• Cracks Showing in the Leveraged Credit Markets:
  Recent company collapses and a spike in large bankruptcies highlight growing fragility in leveraged credit segments, as shown by declining bond prices and increased downgrades.

 

• Sounding the Alarm? & High-Yield Spreads:
  Defaults in private credit remain low, but rising payment-in-kind financing and tight high-yield spreads indicate investors are not fully compensated for increasing risks.

 

• STAAC Commentary and Asset Allocation Guidance:
  STAAC recommends maintaining neutral positions and diversification, favoring mortgage-backed securities and cautioning against increasing portfolio risk in the current environment.