Spreads defy Middle East conflict

Credit Markets Weekly , 25. Jun
The financial markets have reacted to the US attack on nuclear facilities in Iran in a relaxed manner for the time being. Sentiment remained positive. Risk premiums on the corporate bond market also barely reacted. Spreads remained stable in both the IG and IG hybrid segments, while they widened slightly in the HY segment. The good fundamental situation of issuers had a supportive effect. This is also reflected in the rating assessments, with the best upgrade/downgrade ratio since 2022. Since 1Q23, the number of “rising stars” has significantly exceeded the number of “fallen angels”.