Halyard’s Weekly Wrap
our thoughts on the past week’s market activity, economic releases, and Federal Reserve commentary
10/03/25 – US economy slows further as companies and consumers navigate headwinds.
This week, the US bond market saw Treasury yields fall, especially at the shorter end, as investors once again priced in two additional rates cuts by year end. The 10-year yield held its weekly decline amid a slowdown in economic indicators, with private payrolls dropping and services activity stalling. Robust demand for investment grade credit continued with spreads a touch tighter on the week. There have been notable red flags appearing in the high yield and asset back lending space over that past few weeks that investment grade investors are ignoring. Notably, First Brands bankruptcy – a high yield company with significant use of off-balance sheet trade financing and the Tricolor collapse – auto financing focusing on sub prime lending. Are these one-off credit issues or are they indicative of a broader credit cycle immerging within the capital markets?
Economic data released over the past week included better than expected personal spending and income levels, as well as inline PCE prices indices – Core PCE inflation was stable at 2.9% year over year. Consumer confidence and business surveys, however, broadly pointed to a further slowing in economic activity. Job data continue to point to a no fire / no hire equilibrium. The standout in Halyard’s opinion was the uptick in annualized auto sales to 16.39 million units compared to 16.07 million in the previous month. While down from the 17.7-million-unit sales in the 1st quarter of 2025, auto sales are up 4.6% year over year on a 3-month rolling average basis.
As equally sanguine as credit investors, Equity investors shrugged off the US Federal government shutdown and continued to buy – the S&P 500 is trading at yet another record level of $6,725 Friday afternoon. The release of labor statistics – usually one of the more volatile days for bond yields was delayed due to the congressional impasse on funding. Perhaps we get a release next week!
This commentary is being provided by Halyard Asset Management, L.L.C. and its affiliates (collectively “Halyard” or “we”) for informational and discussion purposes only and does not constitute, and should not be construed as, investment advice, or a recommendation with respect to the securities used, or an offer or solicitation, and is not the basis for any contract to purchase or sell any security, or other instrument, or for Halyard to enter into or arrange any type of transaction as a consequence of any information contained herein. Although the information herein has been obtained from public and private sources and data that we believe to be reliable, we make no representation as its accuracy or completeness. The views expressed herein represent the opinions of Halyard Asset Management, LLC, or any of its affiliates, and are not intended as a forecast or guarantee of future results. Past performance is not indicative of future results.
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Halyard’s Weekly Wrap – 10/15/21
/in Weekly Wrap/by halyardThere was much to analyze this week with inflation coming in higher than expected and retail sales surprising to the upside. Equities once again pulled themselves off the mat and appear poised to go at least a few more rounds with greedy and fearful investors. Less obvious but quite telling is the yield curve flattening that took place. The spread between the 2-year note and the 30-year bond has flattened 18 basis points since last Friday. That’s a meaningful move and hints that investors are starting to position for a sooner than advertised interest rate hike.
Halyard’s Weekly Wrap – 10/08/21
/in Weekly Wrap/by halyardAt first glance the September unemployment report released on Friday looked wildly disappointing. It’s been described as “Disastrous” at several media outlets. Consensus was looking for 500,000 newly created jobs for the month, and to be honest, we would have taken the over on that bet. Instead the BLS reported that the economy generated 194,000 jobs for the period.
Halyard’s Weekly Wrap – 10/01/21
/in Weekly Wrap/by halyardFundamentals took a back seat to political in-fighting this week as the Republicans made it clear that they were going to do precious little to assist the Democrat’s goal of lifting the debt ceiling, keeping the government open for business, or passing Biden’s $3.5 trillion social stimulus. Interest rates moved higher across the curve as the uncertainty of fiscal policy spooked bond investors. The new 2-year note auction that was held on Monday was described by one pundit as “gruesome”, given the below average bid-to-cover ratio, and the yield at which it cleared, which was nearly a basis point above the yield asked at auction time. Following the auction, the yield-to-maturity of the 2-year note rose to 0.31%, before drifting back down to 0.266% to close out the week. That’s nearly double where the note traded last summer! Stocks fared worse, with the S&P 500 trading down about 2.5% for the week.
Halyard’s Weekly Wrap – 09/24/21
/in Weekly Wrap/by halyardWhile Chairman Powell and the Open Market Committee failed to signal a start to tapering open market purchases, they did inch closer. Powel described current economic condition as having mostly met the committees standard to begin to taper and suggested that an announcement would be made at the November meeting. Bond investors didn’t like the news and drove the yield on the 10-year note 15 basis points higher to end the week at 1.45%.
Halyard’s Weekly Wrap – 09/17/21
/in Weekly Wrap/by halyardEconomic data this week offered something for everyone. For those seeing the uptick in inflation as transitory, the Consumer Price Index data was not as bad as feared. The month-over-month CPI fell from 0.5% in July to 0.3% in August; arguably an improving trend, but still rising at an above target pace. The year-over-year rate also improved marginally falling from 5.4% in July to 5.3% in August. Again, right direction but still alarmingly high.
Halyard’s Weekly Wrap – 09/10/21
/in Weekly Wrap/by halyardWith the confluence of Labor Day on Monday and Rosh Hashana on Tuesday and Wednesday, we kicked off the week expecting a quiet one. Instead, corporations issued paper at a “break-neck” pace. For the week we saw 52 borrowers sell in excess of $76 billion in paper. Surprisingly, the large supply barely moved interest rates, as the 10-year Treasury note was less than 4 basis points higher for the week. The S&P 500 traded lower each successive day this week as forecasts for slowing economic growth dominated the headlines, but point-to-point the index was down approximately 1.00%. Hardly a correction!