Featured Top Idea
WMS – Advanced Drainage Systems, Inc.
Action: Buy 2030 6.375% Bonds CUSIP: 00790RAB0 (6.332% YTW, 5.393% iYTW)

Aggregate Credit Market and Credit Fundamental Review
Since the Fed started communicating plans to aggressively raise rates in the face of inflationary pressures in 2022, the Fed has consistently been hawkish. The over 500bps increase in interest rates from mid-2021 lows pushed the aggregate corporate cost to borrow to the high end of levels seen in the prior bull market. While recent rate cuts have started to ease credit market risk pricing, borrowing costs remain elevated, pressuring corporate growth and refinancing decisions. As elevated rates persist, corporate cash flow and cash buffers may continue to dwindle, with higher refinancing costs acting as a near-term tax on growth. However, improving bank credit access and tight credit spreads may start to support growth momentum.