Cash flows towards HY EU asset class continue to be positive and JP Morgan weekly analysis underlines 13 consecutive inflows, recording  €3.7 Billion since the beginning of the year.

In US, many analysts fear an increase of default. This confirms our view about European HY market that offers a better risk-return ratio. In US, high HY returns show:

• presence of  energy companies
• increase of CCC issues (nowadays almost 40% of the total)
• increase of financial leverage
• minimum interest coverage since 2009
• increase of distressed assets

In EU, companies show different results from US counterparties:

• stable fundamentals
• lower debt level along with higher average rating

Besides this, EU bonds are having a lot of momentum given CSPP (Corporate Sector Purchase Program) initiative sponsored by ECB. The effect of this financial measure has already been priced by the market, however many analysts expect a further price effect during the implementation in June.