US Speculative Credit a prime laggard in 2015, what about 2016?

Surely 2015 will be marked as one of the worst performances, in terms of total return for the US High yield market over the past years. Undoubtedly, the commodity sector emerged as one of the main drags for the US junk market with notable flagging pressures being noted in the energy oil related companies which traded at distressed levels, in line with falling oil prices. On the flip-side of the story, in line with improving prospects for the US economy, consumer oriented sectors recorded some solid returns. As said from a commodity segmental perspective, amongst the prime laggards for the US High yield markets, were metals and exploration corporates, which registered a total negative return of 26 per cent, followed by the energy sector which declined by circa 24 per cent, both conditioned by the continuous dubious prospective China demand and the oil glut. The latter argument pushed major related sector corporations towards distressed valuations. Interestingly enough, the Bank of America Merrill Lynch Distressed Credit Index shows that at the end of 2014, US90bn of the US HY market was distressed, while by the end of 2015 that figure had more than doubled to US184bn. In terms of...

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