Corporate Market UpdateJanuary 30 UBS
The following is a summary of a UBS full-length report on this topic, dated January 30, 2006.
* Market Recap: Overall investment-grade spreads narrowed about 5 bps in January. Industrials outperformed, as spreads in the sector came in 7 bps; financials narrowed 4 bps and utilities tightened 2 bps. The AAA/AA and single A categories tightened about 2 bps, while triple B's came in 9 bps.
* Market Outlook: We remain cautious on the corporate sector. In line with this stance, we continue to favor higher-quality, defensive, low-beta sectors while avoiding issuers/sectors where the risk of LBOs and other equity-friendly actions is high.
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