Emerging economies are generally considered to have high potential, primarily due to demographic growth and a population that is on average younger than that of developed countries. At the same time, however, these markets are often perceived as less robust in terms of environmental and social sustainability and the quality of democratic institutions. Precisely for this reason, the integration of sustainability criteria into emerging market debt portfolios represents a source of real and measurable added value.

Equity markets experienced a sharp drawdown, with software stocks at the epicentre. Results from ServiceNow, SAP and Microsoft were fundamentally solid, but growth rates came in marginally below expectations (around 1%). More importantly, however, they showed no near-term acceleration. In the current market environment, this lack of acceleration proved sufficient to trigger a software-wide sell-off, with large-cap names falling more than 10% and correlations across the sector spiking sharply.

2026 started off well for European high yield: spreads have continued to tighten in an almost linear fashion since Liberation Day last year and have continued to do so this year. The next question becomes is there any value left?