Rising stars still outpace fallen angels globally, though the gap is narrower than in 2005, when the number of rising stars exceeded that of fallen angels by the biggest margin since 1997.

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U.S. High Yield Monthly: Cautionary Flags. However, the below 3.0% growth projected for the second-half of the year and into 2007 has historically not favored the high yield market, and a cautionary position on this asset class remains.

164

U.S. Distressed Debt Monthly Monitor. In the U.S., the automotive, telecommunications, and retail/restaurant sectors showed the highest propensity for distress as a share of total speculative-grade rated issues.

150

Although balance sheets look strong at this stage of the credit cycle, bond performance is likely to suffer ahead.

128