Login / Register
Contact Us
View Performance
Fixed Income
U.S. Equity
International & Global Equity
Chart Library
Market & Economic Commentary
Fund Literature
Prospectuses, Reports & Holdings
Fact Sheets
Client Guides
Fund Literature
Advisor Resources
Advisor Materials
View Resources
Tax Information
Corporate Credit Highlights
Glossary of Terms

Weekly Market Summary

June 24 to June 28, 2024

View Current Performance

Extra Credit*

  • With most S&P 500 companies having reported, 76% companies beat first-quarter earnings estimates (vs. a 73% average for the fourth quarter of 2023) and 60% beat revenue estimates (vs. 64%). In terms of earnings beats by sector, technology (89%), industrials (85%) and staples (83%) were notable standouts. S&P 500 companies surprised on net income by 3.4% (vs. 4.6% in the fourth quarter). Notably, much of the earnings surprise was concentrated within Magnificent 7 companies relative to remaining S&P 493 (9.9% vs. 1.6%). The largest sectors driving earnings this quarter were communications (13.8%), financials (6.7%) and technology (6%). Revenue surprise was not as strong on the quarter at 0.6% (vs. a 1.4% average in the fourth quarter) given some large misses across industrials and utilities. Overall, first-quarter revenue growth came in at 3.9% (2.8% excluding the Mag 7) and net income growth at 6.9% (-1.4% excluding the Mag 7).
  • For buybacks, activity has surged since 3Q23 from approximately $178 billion to about $240 billion currently. Much of the increase in gross buyback executions since last year has been driven by the technology sector ($11.4 billion) and communications ($10.5 billion). In terms of buyback announcements, S&P 500 buyback announcements stand at $480 billion year-to-date.
  • Credit spreads are trading in the middle of their year-to-date range after widening across the board over the past month. Spreads reached their cycle tights in early May across investment-grade, high-yield and leveraged loans. Since then, investment grade is 8 basis points wider, high yield is 27 basis points wider, and leverage loans have seen selling. This selloff was driven by lower Treasury yields, thanks to a low CPI print, some flight to quality on the back of the French snap poll surprise, and heavier-than-expected issuance.
  • The liquidity risk premium in credit has declined across the board, but more so in the U.S. than in Europe. In the U.S. investment-grade universe (Bloomberg Index), the liquidity risk premium has declined from 27% of index spreads between January 2011 and December 2016 to 12% of spreads between January 2017 and December 2023. In U.S. high yield (Bloomberg Index), it has declined from 26% to 20% of spreads over the same periods. This decline puts ever more pressure on passive fixed-income funds, as selectivity premium through active fixed-income funds looks to have increased.
  • Bank-loan and high-yield bond default rates, excluding distressed exchanges, finished May both at 1.25%, respectively. This was compared to 1.32% and 1.55% from April, as the high yield default rate was 30 bps lower and the loan default rate now sits at a 16-month low. The long-term historical default rate for loans and high yield bonds was 3.0% and 3.4%, respectively.

Sources: Bloomberg and JP Morgan as of 6/24/24. The Magnificent 7 includes Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla.

Yield as of:
June 28, 2024
High-Yield Bonds
Investment-Grade Corporates
Last Week
Prior Week
Start of the Year
Option Adjusted Spread as of:
June 28, 2024
High-Yield Bonds
Investment-Grade Corporates
Last Week
309 bps
482 bps
88 bps
Prior Week
314 bps
480 bps
88 bps
Start of the Year
323 bps
501 bps
93 bps
Prices as of:
June 28, 2024
High-Yield Bonds
Investment-Grade Corporates
Last Week
Prior Week
Start of the Year

*Source: Morningstar®, Bloomberg, Credit Suisse. OAS is Options Adjusted Spread. 4-year discount margin is used for spread for bank loans. Yield quoted is yield-to-worst or equivalent calculation. YTD Low / High for yields are based on end of week and not intraday movements. Indexes and sub-indexes: Investment-grade corporates represented by Bloomberg US Corporate Bond Index. High-yield bonds represented by Bloomberg US Corporate High Yield Index. Bank loans represented by Credit Suisse Leverage Loan Index. The red and green arrows depicted under Yields, Option Adjusted Spreads, and Prices indicate a higher or lower value from the previous week.

Past performance does not guarantee future results. Index performance is not indicative of fund performance. Indexes are unmanaged and it is not possible to invest directly in an index.

Any discussion of individual companies is not intended as recommendation to buy, hold or sell securities issued by those companies. Aristotle Fund holdings can be found on the fund pages linked above.

Investors should consider a fund’s investment goal, risks, charges, and expenses carefully before investing. The prospectus and/or the applicable summary prospectus contain this and other information about the Fund and are available from AristotleFunds.com. The prospectus and/or summary prospectus should be read carefully before investing.

Investing involves risk. Principal loss is possible.

Foreside Financial Services, LLC, distributor.

Scroll horizontally to view tables
Please Upgrade Your Browser.

Unfortunately, Internet Explorer is an outdated browser and we do not support it. To have the best browsing experience, please upgrade to Google Chrome, Firefox or Safari.