Morning Commentary: Junk ETFs see massive $2.29 billion daily outflows on Thursday

By Paul A. Harris

Portland, Ore., Feb. 17 – High-yield ETFs sustained a massive $2.29 billion of daily cash outflows on Thursday, according to a market source.

News of those daily outflows trails a Thursday report that the dedicated high-yield bond funds saw $2.817 billion of net outflows during the week to the Wednesday, Feb. 15 close, according to fund-tracker Refinitiv Lipper.

The high-yield ETFs by far and away sustained the biggest portion of those outflows: negative $2.5 billion on the week, according to the market source.

Actively managed high-yield funds also posted daily outflows of $195 million on Thursday, the market source said.

The high-yield bond market opened Friday as much as ½ point lower but appeared to be rebounding into the mid-morning period, in line with equities, a bond trader said, marking the market ¼ point to 3/8 point lower at that time.

With the Dow Jones industrial average absolutely flat at that time, the iShares iBoxx $ High Yield Corporate Bd (HYG) share price was down 0.18%, or 13 cents, at $74.14.

Among recent issues the Hanesbrands Inc., the 9% senior notes due February 2031 (B1/BB-) were unchanged on the morning at par ½ bid, 101 offered, the trader said.

The $600 million blowout deal priced a week ago at par.

The primary market, which has been idle throughout the week, remained so on Friday morning.

The active new issue calendar is empty.

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