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DoubleLine Capital CEO Jeffrey Gundlach sees change and potential upheaval in 2024, together with a possible U.S. financial downturn and evolving monetary market traits.
After sturdy rallies in late 2023 helped shares and bonds finish the yr in constructive territory, markets face new challenges as pandemic results on the financial system recede, the billionaire investor advised.
The COVID-19 pandemic “has distorted a bunch of financial information” and made indicators much less dependable up to now three years, he stated. “However I feel that’s beginning to fade into the background now as we don’t have all of this super sum of money printing that’s been occurring.”
On a webcast Tuesday and in associated posts on X from from DoubleLine, Gundlach additionally outlined a number of developments within the credit score market. Amongst these, he stated high-yield defaults may enhance as lending requirements tighten, though it’ll in all probability take a recession for that to occur.
Funding-grade credit score broadly could yield mid- to high-single digit yields, in keeping with Gundlach. Non-agency residential mortgage-backed securities yields look engaging, whereas industrial mortgage-backed securities are a blended bag, with AAA “fairly secure” and Conduit CMBS A- dealing with defaults, he famous.
Try the gallery for 12 market and financial predictions from Gundlach.
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