Junk-Bond Investors Fear Bumpy 2022 After November Slump – The Wall Street Journal

Want to know how a jump in interest rates next year could hit markets in unexpected ways? Look at the recent selloff in junk bonds.

The downturn began in early November when new inflation data stoked fears of interest-rate increases, then accelerated when the Omicron coronavirus variant shook stock markets. While prices of the below-investment-grade corporate bonds stabilized last week, investors continued to pull cash from funds that buy the debt.