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If May marked an improvement over April’s primary drought, June was even better — but that’s not to say things are back to normal. While the markets opened back up for lower-rated names, a lack of repricings — coupled with a widening BB-B spread — indicate that lenders are still in risk-off mode.
The second quarter was marked by conflicting dynamics.
June issuance volume returned to the kind of monthly levels we’d seen pre-liberation day, but Q2 volume overall was less than half of what we saw in Q1, thanks to a strong January.
M&A and LBO volumes have been light, but still managed to double their share of total issuance quarter-on-quarter.
June’s primary performance suggests the high yield market has largely come to terms with tariff uncertainty, and we’re finally starting to get a firmer idea of how individual names will be affected as trade deals begin to take shape and cross the finish line.
But the progress on tariffs comes as the president begins to double down on his efforts to pressure Jerome Powell and the Federal Reserve board to cut interest rates, which throws another potential source of uncertainty into the outlook.
“The tone definitely shifted from people seeing continued growth at the start of the year, and then in April thinking about a potential recession,” said Jeremy Burton, high yield and leveraged loan portfolio manager at PineBridge Investments.
"There’s still a lot of uncertainty on the macro front but I don’t think there’s the same fear of a severe recession. The focus in our market now is back to picking individual winners and losers from government policies.”
Figures are based on 9fin data for all USD-denominated deals priced between 1 April and 30 June 2025. Volume by UoP calculated based on the primary use of proceeds for a given deal. Ratings are grouped by average score from Moody’s/S&P/Fitch. Due to ongoing data collection, table and screener data may not exactly match. Access our Q2 bond screener and Q2 loan screener in the 9fin platform.
This is an extract of our Q2 2025 LevFin primary review. Fill in your details below for the full piece, delivered straight to your inbox.
