- Bonds see big back-to-back gains as investors seek high yields
- Nuveen’s John Miller says people ‘are no longer in panic mode’
Since the middle of May, mutual funds that buy the riskiest state and local government bonds have received hundreds of millions of dollars of new cash from investors hunting for higher returns.
At the same time, the economic chaos unleashed by the coronavirus has put many speculative projects on hold, causing sales of junk and unrated municipal bonds to slow to a trickle.
That mismatch between supply and demand had a predictable effect: Prices of high-yield securities have rallied, driving them to a more than 8% gain from May through June. That marks the best two-month period since 2009, according to the Bloomberg Barclays indexes.
Bloomberg Markets
By Shruti Singh and Danielle Moran
July 2, 2020, 10:33 AM PDT