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: Junk bond flows dropped by most since early days of pandemic


Investors pulled the most money last week from a popular high-yield bond fund since the coronavirus crisis first landed in the U.S.

The SPDR Bloomberg High Yield Bond ETF JNK, -0.44% saw outflows of $717 million last week, according to FactSet Research. That’s the most since March 2020, according to Bloomberg News.

Some investors have been encouraged by the resilience of credit during the stock-market turbulence of 2021. This year, the high-yield fund has slipped 3%, which is less than the 6% drop for the S&P 500 SPX, +0.52%.

Investors like corporate bonds as an alternative when the economy slows but doesn’t fall into a recession. While equities suffer as growth prospects slump, companies are likely to continue to meet their debt obligations as long as the economy is growing.

Last week’s report showing 467,000 nonfarm jobs were created in January suggest companies aren’t seeing a recession on the horizon, though an array of other high-frequency data has been slowing.

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