The debt-service coverage ratio, a measure of financial health, has dropped significantly over the past year, indicating increased risk among leveraged loan companies. Morgan Stanley’s Chief Investment Officer warns that if corporate profits disappoint, the stock market rally could end. Options markets show extreme optimism, suggesting investors may be overlooking potential risks.
Something about swimming naked…
I’m repeating this idiom w/greater frequency as more & more laud ample liquidity
“Debt-service coverage ratio averaged 3.5x for median company in the leveraged-loan universe at end of Sept, down from >5x a year earlier.”@apolloglobal @business pic.twitter.com/K1sn3I9KY3
— Danielle DiMartino Booth (@DiMartinoBooth) March 25, 2024
Mike Wilson, Morgan Stanley's Chief Investment Officer, says the stock market rally will end if corporate profits disappoint Wall Street pic.twitter.com/Z5pSVKzqUl
— Win Smart, CFA (@WinfieldSmart) March 25, 2024
Options markets are signaling extreme optimism, as evidenced by the volatility skew being near multi-year lows. pic.twitter.com/DCGKDWeUEt
— Win Smart, CFA (@WinfieldSmart) March 25, 2024
Weekly Crypto Flows
After seven consecutive weeks of inflows, digital asset investments experienced their first weekly outflow.
The crypto markets have surged over the past 12 months, with significant momentum following the launch of spot Bitcoin ETFs earlier this year.… pic.twitter.com/sazhGBffiC— Flip (@trevor_flipper) March 25, 2024