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Saturday April 09, 07:00
S&P’s report favorable for high-yields
(by Dr.Goldfinger)

S&P’s report favorable for high-yields High-yield bonds will show better performance within the next few months after a four-week period of decline, according to a report issued by Standard & Poor’s rating agency.

High-yield bonds started they way up in 2003, but recently saw drastic decline with the investors that withdrew chips from the riskiest projects totalling for $4.5 billion since the beginning of the year.

Some analysts linked the risks to both higher interest rates, Treasury yields and the possibility that General Motors may bring huge debts to the high-yield market after downgrading to speculative grade. “Investors may be overestimating the potential impact of a General Motors downgrade or an accelerated Fed tightening,” said Martin Fridson of FridsonVision, the independent high-yield research company.

Despite general decline, forecasts remain optimistic as the high-yield market could still offer value, market analysts say.
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