Global Economic & Credit Market Briefing

ISM Manufacturing PMI

• The ISM Manufacturing PMI rose to 55.5 in October from 54.5 in September, beating the 54.6 consensus. It marks the 10th straight month of expansion and the second-highest reading in the past 12 months, behind July's 55.6
• Production jumped 2.3 points to 59.0, the highest since November 2021, while new orders edged up to 55.5. Twelve of 18 industries reported growth, although sentiment in respondents' comments worsened for a third straight month, with about two-thirds negative
• The Prices Index eased to 75.2 from 77.9, below the 78.0 expected but still deep in inflationary territory. ISM cited steel and aluminum costs, tariffs, and higher petroleum-based input costs from the Middle East conflict as the main drivers

ISM Services

• The ISM Services PMI slipped to 54.5 in October from 54.9, slightly below the 54.8 consensus. Services have now expanded for 28 straight months, with 15 of 19 industries growing
• Momentum cooled: new orders fell 3.9 points to 55.9 and business activity dropped 2.7 points to 53.8. Employment improved to 51.4 from 50.1, its second straight month above 50
• The Prices Index edged down to 73.0 from 74.0 but stayed above 70 for the seventh time in eight months. ISM said tariffs and fuel costs were respondents' most-cited issues, and that many firms have not yet passed the full cost increases on to customers

Employment Report

• Nonfarm payrolls rose by 165,000 in October, far above the roughly 65,000 consensus and well above the 12-month average of 48,000. Revisions added 84,000 jobs to August and September combined, with September revised up to 60,000 from 29,000
• The unemployment rate fell to 4.1% from 4.2%, below expectations. Gains were led by professional and business services (+70,000), health care (+42,000), transportation and warehousing (+25,000), and manufacturing (+19,000). Average hourly earnings rose 0.4% month over month and 3.1% year over year
• Treasury yields rose after the release, with the 2-year up 6 bp to 4.52% and the 10-year up 3 bp to 4.87%. Market-implied odds of a Fed rate hike in December increased to about 78% from 70%, as strategists said the report gives the Fed room to focus on energy-driven inflation

Jobless Claims

• Initial jobless claims, a measure of how many workers were laid off across the U.S., decreased to 189,000 in the week ended October 30, down 6,000 from the prior week.
• The four-week moving average was 194,750, down 2,250 from the prior week.
• Continuing claims — those filed by workers unemployed for longer than a week — increased at 1.718 million in the week ended October 23. This figure is reported with a one-week lag.

Fed's Balance Sheet

• The Federal Reserve's assets totaled $6.748 trillion in the week ended November 6, up $2.5 billion from the prior week.
• Treasury holdings totaled $4.578 trillion, up $2.4 billion from the prior week.
• Holdings of mortgage-backed securities (MBS) were $1.88 trillion in the week, down $13.7 billion from the prior week.

Total Public Debt

• Total public debt outstanding was $40.56 trillion as of November 6, an increase of 6.4% from the previous year.
• Debt held by the public was $32.77 trillion, and intragovernmental holdings were $7.79 trillion.

GDP

• The latest annualized U.S. GDP stands at $33.01 trillion as of September 30, 2026, an increase of 1.37% from the previous quarter, & an increase of 5.87% from the previous year.
• The total public debt-to-GDP ratio is at 121.70% as of September 30, an increase of 0.99% from the previous year.

Inflation Factors

CPI:

• The consumer-price index rose 3.7% in September year over year.
• On a monthly basis, the CPI increased 0.6% in September on a seasonally adjusted basis, after increasing 0.4% in August.
• The index for all items less food and energy (core CPI) rose 0.3% in September, after rising 0.3% in August.
• Core CPI increased 2.6% for the 12 months ending September.

Food & Beverages:

• The food at home index increased 1.8% in September from the same month a year earlier, and decreased (0.1%) in September month over month.
• The food away from home index increased 3.5% in September from the same month a year earlier, and increased 0.2% in September month over month.

Commodities:

• The energy commodities index increased 9.3% in September after increasing 4.2% in August.
• The energy commodities index rose 35.3% over the last 12 months.
• The energy services index fell (0.2%) in September after decreasing (0.6%) in August.
• The energy services index rose 4.6% over the last 12 months.
• The gasoline index rose 34.2% over the last 12 months.
• The fuel oil index rose 74.2% over the last 12 months.
• The index for electricity rose 4.4% over the last 12 months.
• The index for natural gas rose 5.0% over the last 12 months.

Supply Chain:

• Drewry's composite World Container Index decreased to $4,389.04 per 40ft container for the week of November 6.
• Drewry's composite World Container Index has increased by 124.1% over the last 12 months.

Housing Market:

• The shelter index increased 0.4% in September after increasing 0.3% in August.
• The rent index increased 0.4% in September after increasing 0.3% in August.
• The index for lodging away from home decreased (0.3%) in September after increasing 0.5% in August.

Federal Funds Rate

• The effective Federal Funds Rate is at 3.88%, up 0.24% year to date.

Money Market Funds

• Money market fund assets stood at $8.02 trillion as of November 4, 2026, up 1.4% from the previous week, & up 6.4% from the previous year.

Middle East

• Israel's economy is gaining momentum despite more than three years of conflict. The IMF now expects 4.5% growth this year, up from a 3.5% forecast in July and the fastest among OECD members. Analysts credit adaptable businesses, well-capitalized banks, roughly $237bn in central bank FX reserves and domestic gas supply that has shielded electricity prices from global energy shocks
• The cost is mounting: the Bank of Israel estimates war-related fiscal costs at about $130bn for 2023–2026. Public debt is forecast at 68% of GDP, up from about 60% before the war, the deficit at 4.4% of GDP, and military spending now absorbs about 8% of output. President Trump said this week the US would end military aid to Israel, currently $3.8bn a year, by the end of the year, adding pressure on the next government to choose between higher taxes, civilian spending cuts or more borrowing
• The Democrats' midterm gains have raised questions about whether the Trump administration will resume large-scale strikes on Iran or focus on negotiations. VP Vance publicly cited the war as a top factor in the Republican defeat, while Trump has defended the decision. Talks have stalled for months over sequencing the reopening of the Strait of Hormuz and limits on Iran's nuclear program, and Qatar is making a fresh push to mediate after Trump spoke with its emir on Friday
• Tehran has hailed the Republican losses as a victory and the Revolutionary Guard warns it could retaliate across the region, though mediators say Iran has shown some openness on nuclear issues without offering concrete compromises. The US keeps two carrier groups and about 50,000 troops in the region, with a third carrier group en route. In Israel, opposition gains in the late-October election could weaken hawkish Prime Minister Netanyahu if they manage to form a coalition

Europe

• The Bank of England raised its key rate to 4.0% from 3.75%, its first hike since the Iran war pushed energy prices higher. Officials cited the growing risk of second-round effects, especially larger wage demands early in 2027 as home heating bills rise. The Fed, ECB and BOJ had each already hiked at least once since the war began
• The BOE signaled that borrowing costs will not rise as far as markets expect: one more hike to 4.25% looks likely, while investors had priced the rate reaching 5% by the end of next year. Based on an oil price of $108 a barrel, it now expects inflation to peak at 4.9% in Q2 2027 and return to the 2% target only in Q3 2028. Governor Bailey said an end to the Middle East conflict would bring inflation down faster, though that would not necessarily remove the need for a second hike
• A suspected coordinated hoax campaign of bomb threats disrupted more than a dozen passenger flights across Europe on Thursday, after at least seven flights were hit on Tuesday. Flights were diverted, aircraft grounded and fighter jets scrambled; Ryanair, Wizz Air, LOT and Aer Lingus were among the airlines targeted. No explosives were found in any of the cases
• Two of Thursday's diversions were triggered by an email sent to Rome's main airport, claiming to come from a fringe ultranationalist Russian group. European authorities have not said Russia was involved or whether the incidents are linked. The hoaxes follow a wave of cyberattacks on European supermarket refrigeration systems earlier this week, adding to growing concern over threats to everyday infrastructure

China

• China's blue-chip index has entered bear-market territory, down more than 20% from its June peak, and Morgan Stanley warns of a further 10–15% decline before a bottom. State-backed funds have stepped in to buy, but the intervention looks more like a stopgap than a fix. Losses have spread to foreign investors through US-listed Chinese stocks, Hong Kong shares and the Stock Connect programs
• A new study in The Accounting Review finds that Chinese companies give foreign investors less information than domestic shareholders. English annual reports often leave out details on Xinjiang operations, related-party dealings and Communist Party ties, and firms were half as likely to respond to investors posing as foreign. The researchers say this selective disclosure makes the shares less liquid and capital more expensive to raise, a tension with Beijing's push to attract foreign money
• Hong Kong sentenced pro-democracy activist Joshua Wong to a new 10-year prison term under the National Security Law, after he pleaded guilty to conspiring with foreign forces to call for sanctions against Hong Kong and China. Wong was already serving a sentence of four years and eight months that was due to end in January. Media tycoon Jimmy Lai was sentenced to 20 years under the same provision earlier this year
• Human-rights groups called the case a political prosecution meant to keep Wong behind bars, while the Hong Kong government says prosecutions follow the law regardless of political views. More than 180 people have been convicted of national security offenses in Hong Kong since 2020, a reminder of the legal and governance risks for international businesses operating in the city

Americas

• Paraguayan President Santiago Peña offered to resign while facing impeachment after the collapse of Ueno Bank, the country's fifth-largest bank by assets, in which he had indirectly held a large stake. The central bank's takeover froze $850 million in deposits and left about three million clients in limbo, in a country of 7.1 million, sparking street protests in Asunción. Prosecutors have opened a criminal investigation into Peña, and Vice President Pedro Alliana is next in line to succeed him
• Analysts call it a single bank failure, not a systemic crisis, citing Paraguay's low debt and strong exports of soybeans, beef and hydropower, and a deposit guarantee fund is expected to protect most retail depositors. Still, the episode exposes weak institutions and threatens the country's investment-grade reputation. Ueno's $350 million international bond, the largest ever for a Paraguayan bank and initially underwritten by JPMorgan and Bank of America, has fallen sharply
• Canadian Prime Minister Mark Carney said the latest trade talks with the US have made progress, with Washington "asking less and offering more," though major hurdles remain. President Trump said both sides have "the concept of a very good deal," after negotiations unexpectedly collapsed in August and led to new tariffs on billions of dollars of goods
• Canada is the only G7 country without a deal for relief from Trump's second-term tariffs and is seeking relief from duties of up to 50% on steel, aluminum and autos. After the August breakdown, Trump threatened to double the tariff on Canadian-made cars to 50% from 25%, and officials have said the US does not need Canadian-built vehicles

Russia

• President Putin ordered the seizure of Japan Tobacco's four Russian factories, placing them under temporary management by a local company, in the latest Russian retaliation against Japan for supporting Ukraine and joining Western sanctions. Japan Tobacco, which is about 38% owned by the Japanese government, holds nearly 40% of the Russian tobacco market, and Russia generates roughly a quarter of its profit. The shares fell 19% in Tokyo on Friday. The move follows earlier Russian seizures of Western assets, including those of Carlsberg, Nestlé and, in October, French and Irish manufacturers

North Korea

• North Korea launched several more missiles on Wednesday, bringing its total to nine known launches over the past two months, the most concentrated burst of testing since 2023. The FBI blamed Pyongyang for the $6.3bn Binance hack, after which President Trump said he would talk to the regime. Kim Jong Un's sister rejected talks and set conditions, including an end to US joint drills with Japan and South Korea, withdrawal of the hacking allegations and recognition of North Korea as a nuclear power. Analysts warn that talks without preconditions could amount to de facto recognition of its nuclear status

Taiwan

• Taiwan activated its National Financial Stabilization Fund after the Taiex fell 12% this week, putting it in bear-market territory about 20% below its 2026 high. The selloff came as the Democrats' midterm victory raised concerns about tighter AI regulation slowing demand for AI hardware. The fund can deploy up to about US$15bn, and regulators will tighten short-selling rules from November 9 and encourage company share buybacks. South Korea also stepped up measures to steady its stock market on Friday

China

• Beijing blocked SoftBank's $5.4bn acquisition of ABB's robotics unit, signaling that it will not let technology and expertise developed in China flow to foreign rivals, especially Japan, which is in a diplomatic dispute with China over Taiwan. China is ABB Robotics' largest market, which made the deal subject to Beijing's approval. The decision follows China's earlier ban on Meta's acquisition of Manus and wider controls on cross-border M&A and technology exports. SoftBank shares fell 6.7% and are now down more than 50% from their June high

Sweden

• Sweden's Riksbank raised its key rate to 2.0% from 1.75%, its first increase in more than three years, joining the Fed, ECB, BOJ and BOE in tightening policy since the Iran war pushed energy prices higher. Policymakers said further hikes are likely in the coming year if the outlook holds, and Oxford Economics expects the rate to reach 2.5% by March. Swedish inflation is still low by international standards, helped by lower reliance on imported fossil fuels and tax cuts on transport and food, but the Riksbank expects it to rise above its 2% target next year

Oil Prices

• WTI: $90.83 per barrel
• (12.76%) WoW; +21.24% YTD; +52.40% YoY
• Brent: $98.32 per barrel
• (16.42%) WoW; +25.17% YTD; +55.13% YoY

U.S. Production

• U.S. oil production amounted to 14.0 million bpd for the week ended October 30, up 0.7 million bpd from the prior week.

Rig Count

• The total number of oil rigs amounted to 604, up 1 from last week.

Inventories

Crude Oil

• Total U.S. crude oil inventories now amount to 409.8 million barrels, down (2.7%) YoY.
• Refiners operated at a capacity utilization rate of 94.5% for the week, up from 92.8% in the prior week.
• U.S. crude oil imports now amount to 6.374 million barrels per day, down 7.6% YoY.

Gasoline

• Retail average regular gasoline prices amounted to $4.07 per gallon in the week of November 6, up 32.1% YoY.
• Gasoline prices on the East Coast amounted to $4.06, up 33.8% YoY.
• Gasoline prices in the Midwest amounted to $4.20, up 44.0% YoY.
• Gasoline prices on the Gulf Coast amounted to $3.74, up 43.3% YoY.
• Gasoline prices in the Rocky Mountain region amounted to $4.35, up 41.8% YoY.
• Gasoline prices on the West Coast amounted to $5.44, up 27.5% YoY.
• Motor gasoline inventories were down by 0.2 million barrels from the prior week.
• Motor gasoline inventories amounted to 209.0 million barrels, up 1.4% YoY.
• Production of motor gasoline averaged 9.70 million bpd, down (1.3%) YoY.
• Demand for motor gasoline amounted to 8.808 million bpd, down (0.7%) YoY.

Distillates

• Distillate inventories decreased by 3.6 million in the week of November 6.
• Total distillate inventories amounted to 99.3 million barrels, down (11.0%) YoY.
• Distillate production averaged 5.154 million bpd, up 9.4% YoY.
• Demand for distillates averaged 4.439 million bpd in the week, up 19.6% YoY.

Natural Gas

• Natural gas inventories increased by 77 billion cubic feet last week.
• Total natural gas inventories now amount to 3,801 billion cubic feet, down (2.7%) YoY.

High-yield:

High yield bond yields decreased 8bps to 8.01% and spreads widened 15bps to 365bps. Leveraged loan yields decreased 33bps to 9.29% and spreads tightened 13bps to 495bps. WTD high yield bond and WTD leveraged loan returns were positive 11bps and 32bps, respectively. HY spreads widened as concerns around AI funding and uncertainty following the U.S. midterm elections weighed on investor sentiment. HY funds recorded $1.4bn of inflows after nine consecutive weeks of outflows. Leveraged loans performed better, supported by steady investor demand and $646mn of fund inflows. HY issuance also picked up to $9.7bn during the week, following a slowdown in October.

Week ended 11/06/2026

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 11/06/2026

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: Getty Images ($850mn, 10/21/2026), Leslie's Poolmart ($757mn, 09/30/2026), Brightline East ($1.1bn, 09/24/2026), Hughes Satellite Systems ($1.5bn, 08/02/2026), Unifrax Investment ($3.1bn, 07/26/2026), Dish DBS ($9.8bn, 06/30/2026), QVC Group ($2.2bn, 04/16/2026), Cumulus Media ($641mn, 03/05/2026), Trinseo ($390mn, 02/17/2026), Beasley Broadcasting Group ($189mn, 02/01/2026) and Nine Energy Service ($300mn, 02/01/2026).

CLOs:

Week ended 11/06/2026

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