(AOF) – “The volatility and dispersion of the European market will remain high,” warns Vincent Marioni, director of credit management at AllianzGI, about High Yield credit. However, he sees value in the current spread levels, which should help absorb the elements of risk. However, it will be necessary to be selective in the choice of sectors, and to know how to navigate between good and bad issuers. “The dependence on energy, and in particular on Russian gas, will make the difference”, underlines the asset manager.
“In High Yield, we like telecoms and healthcare, which are not cyclical sectors but currently provide similar remuneration to them. But we have become very cautious on the automotive sector, real estate, whose refinancing will having to be done at high levels, and the packaging, which is very exposed to the problem of gas supply.” gives as examples, Vincent Marioni.
“The banking sector should remain resilient,” said Simon Outin, head of financial sector credit research, who highlights Spain in the High Yield universe. “Thanks to the strong consolidation carried out over the last ten years, to the efforts on cost structures and to the improvement in the quality of the assets, the Spanish banks are well positioned and present an attractive valuation”.
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