Stabilizing After Shock

April brought a welcome stabilization after March’s sharp risk repricing, as easing volatility and lower tail risks helped credit and securitized markets recover.

Geopolitical tensions and elevated energy prices still matter, but corporate fundamentals remained broadly resilient, with spreads tightening across investment grade, high yield, and mortgages.

The main opportunities now look to be in carry-driven areas such as select credit, emerging market debt, securitized products, and inflation-linked bonds where valuations remain more attractive.

Risks are still centered on inflation persistence, policy uncertainty from central banks, and renewed shocks from the Middle East or oil markets.