US junk bond yield hits record lows on coronavirus vaccine hopes

The average yield for the Bloomberg Barclays US corporate high yield index tanked by 45 basis points to a record low of 4.56% on Monday as coronavirus vaccine hopes boosted risk appetite and demand for riskier companies. 

Monday's slide was the biggest single-day decline since April 9, when the Federal Reserve expanded its corporate bond purchases to include some junk debt, according to Bloomberg. The previous record low of 4.83% was set in June 2014.

While the junk bond yield reached record lows, the yield on the 10-year Treasury yield jumped over 10 basis points to 0.97%, the highest since March 20. The data indicates investors rotated money out of safe havens and into risk assets. 

The investor sentiment was buoyed by reports that a large-scale study for a coronavirus vaccine developed by Pfizer Inc. and BioNTech SE prevented over 90% of infections.