High-Yield Bonds Rally Because Oil Drillers Might Catch a Break

Alexandra Scaggs High Yield Energy Crude Oil/Natural Gas Upstream Operations Crude Petroleum Extraction Trusts/Funds/Financial Vehicles Natural Gas/Oil Extraction Exchange Traded Funds Financial Services Fossil Fuels Investing/Securities Donald Trump Debt/Bond Markets Commodity/Financial Market News Corporate Debt/Bond Markets Content Types Factiva Filters C&E Exclusion Filter HYG I/EXT I/FSL I/IAV I/OIS JNK M/ENE M/FCL N/BON N/DJN N/MKT N/PRD N/WER HYG iShares iBoxx $ High Yield Corporate Bond JNK SPDR Bloomberg Barclays High Yield Bond ETF Barrons.com Barrons Blogs Wires S&P 500 SPX CODES_REVIEWED Bonds Commodities Oil Energy High Yield Sector Focus author Alexandra Scaggs author|Alexandra Scaggs topicid 8576 name Alexandra Scaggs extractedtext Alexandra Scaggs rank 1 codetype author code alexandra_scaggs nameformat surname_first author Alexandra Scaggs id Alexandra Scaggs barrons_display_subject BARHIGHYELD barrons_display_subject|BARHIGHYELD codetype BARRONS_DISPLAY_SUBJECT 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BARCOMOIL subject BARSECFOCUS subject|BARSECFOCUS ruleid BARSECFOCUS codetype SUBJECT value BARSECFOCUS canbedisplaybrand true name Sector Focus title Sector Focus status modified code BARSECFOCUS wordcount 308 wordcount|308 id facebook id|facebook news_tab_url https://www.barrons.com/articles/high-yield-bonds-oil-drillers-production-russia-saudi-arabia-51585841987 Photograph by ISMAEL FRANCISCO/POOL/AFP via Getty Images High-Yield Bonds Rally Because Oil Drillers Might Catch a Break High-Yield Bonds Rally Because Oil Drillers Might Catch a Break High-Yield Bonds Rally Because Oil Drillers Might Catch a Break

The high-yield bond market rallied on news that oil and gas drillers—one of the largest sectors in that market—could get relief from the relentless pressure caused by a supply glut.

High-Yield Bonds Rally Because Oil Drillers Might Catch a Break

The high-yield bond market rallied on news that oil and gas drillers—one of the largest sectors in that market—could get relief from the relentless pressure caused by a supply glut.

https://twitter.com/realDonaldTrump/status/1245720677660925952 mailto:alexandra.scaggs@barrons.com High-Yield Bonds Rally Because Oil Drillers Might Catch a Break By Alexandra Scaggs Photograph by ISMAEL FRANCISCO/POOL/AFP via Getty Images President Trump said Russia and Saudi Arabia might be near a deal to cut oil production.

The high-yield bond market rallied Thursday morning on news that oil and gas drillers—one of the largest sectors in that market—could get a break from the relentless pressure on their business caused by the recent battle between the big oil-producing countries over cutting supply.

The iShares iBoxx $ High Yield Corporate Bond ETF (HYG) was up 1.2% around 11 a.m. Eastern time. The SPDR Bloomberg Barclays High Yield Bond ETF (JNK) was also up around 1.2%.

The gains followed a tweet from President Donald Trump that said Russia and Saudi Arabia might be near a deal to cut production by 10 million to 15 million barrels. The S&P 500 was up 1.4% and oil jumped more than 30%.

As of Wednesday’s close, bonds issued by energy companies made up about 8.9% of the $1.1 trillion ICE BofA High Yield Bond Index, the fourth-largest sector.

A year ago, energy bonds were the market’s largest sector by far, and made up about 15% of the index.

Write to Alexandra Scaggs at alexandra.scaggs@barrons.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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