Leading Indicators

• The Conference Board's Leading Economic Index (LEI) fell 0.2% in June to 99.1, reflecting weaker consumer spending and expectations, along with a decline in building permits.
• Despite the June decline, the LEI has remained relatively stable in 2026, with stronger AI-related business investment and easing inflation helping offset softer consumer activity and support the broader economy.

US Flash Manufacturing & Services PMI

• U.S. private sector activity expanded in June, with the S&P Global Flash Composite PMI rising to 52.2 from 51.5, driven by stronger manufacturing output, increased new orders, and a modest improvement in services activity.
• Business sentiment improved, but hiring remained cautious, as companies reduced staffing due to concerns over costs and the economic outlook, while S&P Global noted manufacturing growth was partly supported by inventory building amid supply chain concerns.

Jobless Claims

• Initial jobless claims, a measure of how many workers were laid off across the U.S., decreased to 187,000 in the week ended July 17, down 22,000 from the prior week.
• The four-week moving average was 207,500, down 7,250 from the prior week.
• Continuing claims — those filed by workers unemployed for longer than a week — decreased at 1.796 million in the week ended July 10. This figure is reported with a one-week lag.

Fed's Balance Sheet

• The Federal Reserve's assets totaled $6.747 trillion in the week ended July 24, up $4.4 billion from the prior week.
• Treasury holdings totaled $4.512 trillion, up $3.0 billion from the prior week.
• Holdings of mortgage-backed securities (MBS) were $1.95 trillion in the week, down $1.6 billion from the prior week.

Total Public Debt

• Total public debt outstanding was $39.68 trillion as of July 24, an increase of 8.0% from the previous year.
• Debt held by the public was $31.91 trillion, and intragovernmental holdings were $7.78 trillion.

GDP

• The latest annualized U.S. GDP stands at $31.87 trillion as of March 31, 2026, an increase of 1.41% from the previous quarter, & an increase of 6.07% from the previous year.
• The total public debt-to-GDP ratio is at 122.59% as of March 31, an increase of 2.05% from the previous year.

Inflation Factors

CPI:

• The consumer-price index rose 3.5% in June year over year.
• On a monthly basis, the CPI decreased (0.4%) in June on a seasonally adjusted basis, after increasing 0.5% in May.
• The index for all items less food and energy (core CPI) fell 0.0% in June, after rising 0.2% in May.
• Core CPI increased 2.6% for the 12 months ending June.

Food & Beverages:

• The food at home index increased 2.7% in June from the same month a year earlier, and increased 0.2% in June month over month.
• The food away from home index increased 3.4% in June from the same month a year earlier, and increased 0.2% in June month over month.

Commodities:

• The energy commodities index decreased (9.5%) in June after increasing 6.7% in May.
• The energy commodities index rose 27.0% over the last 12 months.
• The energy services index rose 1.5% in June after increasing 0.7% in May.
• The energy services index rose 3.9% over the last 12 months.
• The gasoline index rose 26.7% over the last 12 months.
• The fuel oil index rose 42.9% over the last 12 months.
• The index for electricity rose 4.0% over the last 12 months.
• The index for natural gas rose 3.0% over the last 12 months.

Supply Chain:

• Drewry's composite World Container Index decreased to $4,373.70 per 40ft container for the week of July 24.
• Drewry's composite World Container Index has increased by 73.7% over the last 12 months.

Housing Market:

• The shelter index increased 0.1% in June after increasing 0.3% in May.
• The rent index increased 0.1% in June after increasing 0.3% in May.
• The index for lodging away from home decreased (2.5%) in June after increasing 2.6% in May.

Federal Funds Rate

• The effective Federal Funds Rate is at 3.63%, down (0.01%) year to date.

Money Market Funds

• Money market fund assets stood at $7.86 trillion as of July 22, 2026, down (0.3%) from the previous week, & up 11.1% from the previous year.

‍

Middle East

• Bahrain and Kuwait reportedly launched airstrikes on military targets inside Iran, marking their first direct retaliation against Tehran, while the UAE provided intelligence and defensive support as Gulf states take a more active role in the conflict.
• The prolonged conflict is increasing economic and security risks across the Gulf, with disruptions to the Strait of Hormuz, attacks on critical infrastructure and shipping, and growing concerns that regional governments may be forced into a more direct confrontation with Iran.
• Satellite imagery indicates Iran is rapidly rebuilding military infrastructure damaged by U.S. and Israeli strikes, including missile bases, tunnels, bridges, ports, and production facilities, raising questions about the long-term effectiveness of the air campaign.
• Officials warn Iran's reconstruction could restore military capabilities over time, with concerns that underground facilities, stockpiled components, and preserved technical expertise will allow Tehran to replenish its missile arsenal and potentially reconstitute elements of its nuclear program.

Europe

• Severe heat waves have fueled widespread wildfires across Europe, forcing the evacuation of tens of thousands of people in France and Spain, including from major tourist destinations, as burned acreage has risen 84% above the 20-year average.
• Spain declared its first-ever national wildfire emergency, while France sought international firefighting assistance as fires spread dangerously close to populated areas, highlighting the growing strain on emergency resources and infrastructure.
• Ukrainian drone strikes on Wildberries logistics hubs are bringing the war deeper into Russia, destroying major warehouses, disrupting the country's largest e-commerce platform, and causing an estimated $3–4.4 billion in damages, with many small businesses suffering significant inventory losses.
• The attacks are adding to mounting economic pressure in Russia, exacerbating fuel shortages, inflation, and declining consumer confidence while highlighting the increasing impact of the war on everyday Russians and the broader economy.

China

• China is accelerating its push for AI chip self-sufficiency, with the government backing Huawei and other domestic firms to reduce reliance on U.S. technology through major investment, policy support, and pressure on Chinese companies to adopt locally made chips.
• Despite rapid progress, China still trails U.S. chip capabilities, as domestic production remains constrained and leading Chinese chips lag Nvidia's performance, though advances in engineering workarounds and AI software are helping narrow the gap over the longer term.
• Despite renewed diplomatic tensions, the U.S. and China are maintaining high-level engagement, with both sides working toward potential leader meetings later this year as they seek to preserve economic stability and manage strategic competition.
• Artificial intelligence remains a central area of competition, as China accelerates investment in domestic AI capabilities and promotes open-source models while continuing efforts to narrow the technology gap with leading U.S. firms.

India

• Indian companies are ramping up overseas acquisitions to diversify markets, access technology, and strengthen supply chains amid geopolitical uncertainty, with outbound investments reaching $14 billion in the first four months of fiscal 2026, compared with $18.7 billion in the prior full year. Major deals include Sun Pharma's $11.7 billion acquisition of US-based Organon and Persistent Systems' €1.3 billion bid for Germany-based Nagarro.

Venezuela

• Twin magnitude 7+ earthquakes struck Venezuela on June 25-26, killing 900+ and leaving 51,000 missing — citizens conducted their own rescue operations amid a slow government response, putting Rodríguez's leadership under its first major test and casting uncertainty over the Trump administration's partnership with her and the prospect of US investment reopening in the country

Colombia

• Far-right populist Abelardo de la Espriella — a criminal defense attorney who has represented paramilitary commanders and money launderers — captured 44% of the vote in Colombia's first-round presidential election, setting up a June 21 runoff against leftist Iván Cepeda that presents voters with the starkest ideological choice in the country's modern political history

Africa

• The WHO declared a global health emergency over an Ebola outbreak in Congo and Uganda, with around 80 deaths and over 200 suspected cases recorded — including cases in both countries' capitals — involving the rare Bundibugyo strain for which no approved vaccine or treatment currently exists

Cuba

• CIA Director Ratcliffe made a rare visit to Havana to warn Cuban officials they have a limited window to engage with the Trump administration, as the island faces severe fuel shortages, widespread blackouts, and growing street protests

Australia

• Australia is permanently diversifying its oil imports beyond Middle East suppliers and accelerating its renewable energy transition, even as it secures emergency fuel reserves to buffer against the ongoing Strait of Hormuz disruption

Canada

• Canada approved Enbridge's ~$3 billion Westcoast pipeline expansion, adding 300 million cubic feet per day of capacity as part of PM Carney's push to reduce U.S. trade dependence and boost Asian energy exports

Italy

• Trump publicly broke with Italian PM Giorgia Meloni — once his closest European ally — after she refused to send forces to the Strait of Hormuz and called his attacks on Pope Leo "unacceptable," leaving her isolated on both sides of the Atlantic

Japan

• Japan will release an additional 20 days' worth of oil reserves in early May to stabilize energy prices, as the country relies on the Middle East for over 90% of its crude imports and the Strait of Hormuz remains largely blocked

‍

Oil Prices

• WTI: $90.32 per barrel
• +9.49% WoW; +20.56% YTD; +38.42% YoY
• Brent: $97.98 per barrel
• +11.21% WoW; +24.74% YTD; +41.63% YoY

US Production

• U.S. oil production amounted to 13.8 million bpd for the week ended July 17, down 0.1 million bpd from the prior week.

Rig Count

• The total number of oil rigs amounted to 587, down 1 from last week.

Inventories

Crude Oil

• Total U.S. crude oil inventories now amount to 411.7 million barrels, down (1.7%) YoY.
• Refiners operated at a capacity utilization rate of 96.1% for the week, down from 96.2% in the prior week.
• U.S. crude oil imports now amount to 5.689 million barrels per day, down (2.8%) YoY.

Gasoline

• Retail average regular gasoline prices amounted to $4.11 per gallon in the week of July 24, up 29.9% YoY.
• Gasoline prices on the East Coast amounted to $4.04, up 29.5% YoY.
• Gasoline prices in the Midwest amounted to $3.87, up 26.1% YoY.
• Gasoline prices on the Gulf Coast amounted to $3.69, up 30.1% YoY.
• Gasoline prices in the Rocky Mountain region amounted to $4.09, up 25.4% YoY.
• Gasoline prices on the West Coast amounted to $5.11, up 23.1% YoY.
• Motor gasoline inventories were up by 0.8 million barrels from the prior week.
• Motor gasoline inventories amounted to 211.3 million barrels, down (8.6%) YoY.
• Production of motor gasoline averaged 9.70 million bpd, up 3.6% YoY.
• Demand for motor gasoline amounted to 8.947 million bpd, down (0.2%) YoY.

Distillates

• Distillate inventories decreased by 1.4 million in the week of July 24.
• Total distillate inventories amounted to 109.6 million barrels, down (0.3%) YoY.
• Distillate production averaged 5.349 million bpd, up 5.3% YoY.
• Demand for distillates averaged 3.718 million bpd in the week, up 11.2% YoY.

Natural Gas

• Natural gas inventories increased by 32 billion cubic feet last week.
• Total natural gas inventories now amount to 3,056 billion cubic feet, down (0.6%) YoY.

‍

High-yield:

High yield bond yields increased 23bps to 7.46% and spreads widened 6bps to 309bps. Leveraged loan yields increased 18bps to 9.07% and spreads widened 2bps to 491bps. WTD high yield bond returns were negative 47bps while WTD leveraged loan returns were positive 6bps. 10yr treasury yields increased 13bps to 4.68%. High yield spreads widened as higher Treasury yields, rising oil prices and escalating geopolitical tensions in the Middle East weighed on investor sentiment. Despite modest spread widening, leveraged loans remained relatively resilient, supported by strong CLO demand, positive fund flows and active primary market issuance.

Week ended 07/24/2026

Yields & Spreads¹

Pricing & Returns¹

Fund Flows²

New Issue²

Distressed Level (trading in excess of 1,000 bps)²

Total HY Defaults

Leveraged loans:

Week ended 07/24/2026

Yields & Spreads¹

Pricing & Returns¹

Fund Flows²

New Issue²

Distressed Level (loan price below $80)¹

Total Leveraged Loan Defaults

Default activity:

• Most recent defaults include: Dish DBS ($9.8bn, 6/30/2026), QVC Group ($2.2bn, 4/16/2026), Cumulus Media ($641mn, 03/05/2026), Trinseo ($390mn, 02/17/2026), Beasley Broadcasting Group ($189mn, 02/01/2026), Nine Energy Service ($300mn, 02/01/2026), Multi-Color ($4.5bn, 01/29/2026), Pretium Packaging ($201mn, 01/28/2026), Saks Global Enterprises ($2.7bn, 12/30/2025), and United Site Services ($2.6bn, 11/30/2025).

CLOs:

Week ended 07/24/2026

New U.S. CLO Issuance²

New U.S. CLO YTD Issuance²

Note: High-yield and leveraged loan yields and spreads are swap-adjusted

¹ Source: Credit Suisse High Yield and Leveraged Loan Index

² Source: JP Morgan

Ratings activity:

S&P and Moody's High Yield Ratings

Source: Bloomberg

Appendix:

Diagram A: Leveraged Loan Trading Levels

Source: Credit Suisse Leveraged Loan Index

Diagram B: High Yield and Leveraged Loan LTM Price

Diagram C: Leveraged Loan and High Yield Returns

Diagram J: New Issue - Leveraged Loan and High Yield

Diagram K: Leveraged Loan + HY Defaults by Sector – LTM

Source: JP Morgan Default Monitor

Diagram L: CLO Economics

Diagram M: Developed Country Govt. Bond Yields (%)

Diagram N: S&P 500 Historical Multiples

Source: S&P Capital IQ

Diagram O: U.S. Middle-Market M&A Valuations (EV/EBITDA)

Source: Pitchbook

Diagram P: U.S. Large Cap M&A Valuations (EV/EBITDA)

Source: Pitchbook

Diagram Q: Dry Powder for All Private Equity Buyouts ($B)

Diagram R: Dry Powder for All US Debt ($B)

Diagram S: Structured Credit Spreads

Source: Bloomberg

Diagram T: Structured Credit Yield

Source: Bloomberg

Diagram U: SOFR Curve

Diagram V: CMBS Spreads

Source: Bloomberg

‍