Bear Stearns High Yield Index finishes week with 6.69% year-to-date return

By Paul Deckelman

New York, Sept. 22 - The Bear Stearns High Yield Index has returned 6.69% for the year through Sept. 21, a gain of 0.09% from the 6.60% level seen the week before, ended Sept. 14.

So far for September, the index is up 0.94%.

In the most recent week, the index's yield to worst tightened 51 basis points, to 8.42% - a reversal of the movement seen the previous week, when the yield to worst widened 46 bps to 8.93%.

The yield-to-worst spread meantime contracted by 39 bps to 377 bps in the latest week, after having widened by 46 bps to 416 bps the week before.

For the month to Sept. 21, all 12 of the broad industry sectors into which Bear Stearns divides its index showed positive returns.

Telecommunications had the best return for the month to date at 1.50%. It took over from the health care sector, which was the previous week's month-to-date outperformer with a 1.53% return.

However, health care also remains the only sector in the red on a year-to-date basis, down 0.39%, widening its year-to-date loss from the 0.11% seen the previous week.

The consumer cyclical sector is the best year-to-date performer so far, at 10.07%, although that was down from its 10.32% showing the week before. Consumer cyclical is the only broad index sector so far sporting a double-digit year-to-date return, driven largely by the robust performance of its automobile manufacturing-related subsector, which is up 16.20% on the year so far.

Looking at the performance of other individual subsectors within the broader industry divisions, the telecommunications sector's ESMR & PCS subsector remained the best month-to-date performer, up 3.62% so far, while the health care sector's diagnostic services unit was the worst performer on a monthly basis, having lost 1.12% for the month so far.

On a year-to-date basis, the health care sector's hospital management component wallows in the most red ink, with a 5.14% cumulative loss. Diagnostic services is not much better, having lost 5.07% on the year so far.

On the upside, the transportation sector's airlines subsector has the best year-to-date return, 24.43%, followed by telecom's long-distance subsector, up 18.62%, and the automotive manufacturing subsector, up 16.20% as noted.

As of Sept. 21, the index had a market value of $573.082 billion, off from the previous week's $575.870 billion, and it tracked 1,653 issues, up from 1,642 issues the week before.

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