Credit Spotlight: Financials and COVID-19

The third quarter ended on a softer note, with unrelenting concerns about elevated oil prices, sticky inflation, and the subsequent spike in bond yields weighing on financial market valuations and investor sentiment.

Investor sentiment was surprisingly resilient in August, even despite warnings from the bond market, signs of weakness from the American consumer, growing wariness about the artificial intelligence (AI) trade, and an erratic geopolitical and trade landscape.