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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Watch Your Step, Says Pimco |
Forbes.com - Oct. 1, 2009 - by Matthew Craft
After a long run for credit markets, a bond fund manager calls for prudence.
With money flooding into fixed-income funds and corporate bonds posting a banner year, the bond gurus at Pimco are sounding a cautionary note. Bonds still look attractive compared with cash and stocks, but given the run-up in bond prices and Pimco's expectations of sluggish economic growth, it's best to be picky.
In a commentary this week, PIMCO manager Mark Kiesel writes that low interest rates and tighter yield spreads over Treasurys may continue to draw companies to issue bonds, increasing supply. Economic worries could also dampen investors' appetites. Both could push down prices and lift yields, an effect magnified for riskier bonds.
Pimco, which manages $841 billion, has been the bond market's most visible booster. Bill Gross, who runs its largest fund, and Kiesel even favored certain credit investments in the middle of the financial crisis. But the Pimco view is that the U.S. economy won't return to 5% annual GDP growth because of weak demand, high unemployment and flat wages. Pimco executives are calling 1%-to-2% growth "the new normal." (See "U.S. Economy's Rusty Rebound").
In such an environment, Kiesel likes companies that have government support, emerging-market ties and little debt. Most attractive are senior-ranked bonds in banking, pipelines, energy, metals, telecom, health care and cable.
Kiesel names no specific companies in his commentary. The PIMCO corporate income fund, which he manages, held 77% of its assets in corporate bonds as of July 30, according to regulatory filings made last week. Its largest holdings are in banking (26%) and financial services (25%).
Given Kiesel's cautious tone, some of the fund's purchases may look surprising. There are stalwarts like Goldman Sachs ( GS - news - people ) and JPMorgan Chase ( JPM - news - people ), as well as bonds attached to troubled companies such as International Lease Finance Corp, the aircraft-leasing arm of AIG ( AIG - news - people ).
It also has a range of CIT Group ( CIT - news - people ) bonds, including notes with a $3.7 million face value maturing Oct. 15. Credit analysts expect CIT to target those bonds in an exchange offer as part of an effort to unload debt. A bondholder committee, which includes Pimco, floated the cash-strapped commercial lender a $3 billion loan in July and gave CIT until Oct. 1 to submit a restructuring plan.
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| Stuff to look at |
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Income Security Recommendation January 2013 Issue.
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