US

The European corporate hybrid market has been established for some time. It is dominated by investment grade issuers seeking to raise capital with limited impact on their leverage ratios, thanks to rating agency treatment that classifies hybrids as 50% equity and 50% debt from a balance sheet perspective.

The US and the European Union (EU) have reached a trade agreement, averting a worst-case scenario of a more damaging trade war.

The Trump administration’s immigration policy leaves the US labour market at a pivotal juncture.

The turbulent start to 2025 has sent many investors seeking alternatives to US assets, but in our view European fixed income can offer more than just diversification.

Softer US economic data means the pressures on UST yields now look more balanced, but headlines around President Trump’s pick for the next Fed chair are just one reason investors should expect rates volatility to continue.

Despite Israel and Iran exchanging fire for a fifth day, markets seem to be completely disregarding the possibility of this conflict mutating into something serious for the global economy.

While tariffs have done meaningful damage to the economic outlook and raised volatility in rates markets, the softening of the US stance has restored confidence in credit returns for 2025.

As markets digest and speculate about the implications of the Trump administration’s 1,000+ page One Big Beautiful Bill Act (OBBBA), new details are beginning to emerge.

Monday was a somewhat eventful day for markets with several headlines in the US and Europe. Risk assets did not necessarily reflect the eventfulness of the day, finishing virtually unchanged, while rates had a volatile day that ultimately produced a sizeable rally.

Thus far in 2025, the prevailing and overriding topic of conversation amongst economists and market participants has been tariffs and what they might mean for the global macro outlook.

The question for investors now is how much of the macro risk remains, and how well that risk is being reflected in asset valuations.

With much fanfare, President Trump and Prime Minister Starmer announced a “historic” trade deal between the US and UK on Thursday. The main points for the UK are a reduction in auto tariffs from 27.5% to 10% for the first 100,000 cars that enter the US, and the removal of steel and aluminium tariffs.