Market insights and commentary from Loomis Sayles.

Loomis Sayles' Q2 2026 Credit Analyst Diffusion Indices (CANDIs) survey of ~30 industries finds that forward-looking sentiment has softened—falling below neutral for the first time since mid-2025—driven by rising input costs, oil price pressure, and geopolitical uncertainty. Despite the sentiment pullback, profit margins remain near record levels (~14% for the S&P 500), balance sheets are solid, and the firm favors harvesting carry across US and non-US credit benchmarks given limited scope for further spread compression.

Loomis Sayles' Co-Head of Emerging Markets Debt argues that EM corporate bonds offer insurance companies a compelling combination of incremental yield, lower net leverage, and stronger interest coverage relative to developed market peers across both investment grade and high yield segments. The piece highlights favorable spread comparisons, supportive technicals from constrained net issuance, and sector-specific opportunities in energy, mining, telecom, and utilities as reasons for insurers to allocate to the asset class.

Loomis Sayles portfolio managers from the Full Discretion, Private Credit, and Structured Finance teams present a video-based framework examining the convergence of public and private credit markets. The piece outlines an integrated platform approach designed to identify income opportunities across the full credit spectrum, spanning publicly traded bonds, private credit, and structured finance instruments.
The Loomis Sayles Macro Strategies Team provides a comprehensive regional breakdown of global GDP forecasts for 2026, covering the US, Canada, UK, Euro Area, Latin America, Asia Pacific, Japan, China, and CEEMEA, against a backdrop of an ongoing US-Iran conflict and energy supply disruptions. Key themes include below-trend but non-recessionary US growth (2.0% real GDP), elevated core PCE at 3.2%, China recovering gradually to 4.5–5.0%, Latin America as a relative commodity beneficiary, and Europe and Japan as the most vulnerable to energy price shocks.

Loomis Sayles' Full Discretion Team argues that structural forces—demographics, geopolitical spending, an investment boom, and fiscal deficits—are driving a persistent upward bias in interest rates, with cyclical inflation pressures (including an Iran War energy shock) pushing US CPI above 4%. Despite near-term yield volatility, the team views bonds as approaching fair value, contending that today's higher starting yields provide a meaningful cushion against further principal losses.