MarketWatch reports that “consumers drove the U.S. economy to its longest period of economic expansion in history – or at least until the pandemic hit.” According to MarketWatch, “That is something bond investors want policy makers in Washington to keep in mind as they haggle over another coronavirus aid package, and get down to the wire on the fate of the extra $600 a week CARES Act unemployment benefit that expires Friday.” Voya Head of Securitized Credit Dave Goodson said, “In an environment like this, and even before the economic slowdown, your most levered borrower has had to borrow to stay afloat, and already has been victimized by income inequality.” Goodson told MarketWatch that “the CARES Act was a godsend for those borrowers,” and “that it not only propped up struggling households, but also contributed to an eye popping rate of personal savings since February.” Goodson asked, “If we get caught up in a world of uncertainty, because both sides of the political aisle negotiate this aid package into oblivion, how are borrowers supposed to plan what to do next?” Such a scenario, Goodson continued, “could be a real recipe for disaster.”
Bloomberg TV What’d You Miss? featured an interview with Voya Senior Portfolio Manager and Asset Allocation Head Barbara Reinhard, who discussed her general expectations about the earnings season and longer-term market outlook. Reinhard said that “in terms of earnings expectations, you are starting to see revisions start to climb,” especially as the market is “really looking towards 2021.” She added that what investors should “focus on is central bank liquidity,” because that “drives asset prices.” Looking ahead, Reinhard said that Voya is focusing its portfolios “much more so on the U.S. than anywhere else in the rest of the world” and that “we do believe that the U.S. dollar is likely to take a respite from its recent declines.” Furthermore, Reinhard said that “there is no country in the world that has as much fiscal and monetary support as the U.S. does.” Reinhard added it’s for these reasons that “we think the U.S. is probably going to be the longer-term winner over the next one to two years while we’re still slugging it out with COVID.” Reinhard also commented that ultimately “we know it would come down” to federal government fiscal support to underpin U.S. markets. She said more fiscal supports are likely on the way because the high unemployment rate will force the federal government to act.
Pensions & Investments reports that Voya Investment Management named Tom Frost as Managing Director and Head of EMEA Insurance and Pension Solutions. Voya spokesperson Kristopher Kagel confirmed the move in an email. A Voya news release issued Tuesday says that Frost “delivers ‘asset management solutions to insurance, pension and sovereign wealth fund clients in Europe, the Middle East and Africa.’” The article adds that Frost will be based in London and report to Voya Senior Managing Director and Head of Distribution Charlie Shaffer and Voya Managing Director and Head of Insurance Solutions John Simone. Frost last worked for Interritus Advisory.
Connect Media reports that, in response to the ongoing coronavirus outbreak and subsequent economic downturn, both investors and lenders believe that the real estate sector is likely to face headwinds as the economy recovers at different speeds in areas across the country. Voya Investment Management Managing Director and Head of Real Estate Finance Greg Michaud said he believes the recovery will be “idiosyncratic,” saying, “You’re going to have to pick your spots on where relative value is, and go to the markets where you want to be.”
Ignites reports Jane Conway recently joined Voya Investment Management as its new Head of Distribution Enablement and Intelligence. In her new role, Conway “is responsible for leveraging Voya’s data capabilities to help the firm’s sales, marketing and client service teams be more efficient and effective.” In a statement, Voya Head of Distribution Charlie Shaffer said that Voya is looking to take a more data-driven approach to its distribution capabilities to engage clients “at the right time in the channel they want to engage with us.” Conway is expected to help further those efforts, with Shaffer saying, “Jane brings a tremendous amount of expertise and we look forward to working with her to advance our various initiatives in this space.”
Voya Investment Management Head of Real Estate Finance Gregory Michaud recently appeared on ABS in Mind, a Debtwire podcast presenting “the latest issues affecting asset-backed securities markets and the loans they finance.” In the interview, Michaud “details how insurers are taking advantage of dislocations created by COVID-19 and discusses where they’ve become more selective.” Voya’s new strategies “include backing away from lending on retail properties, steering clear of hospitality and sticking with office buildings,” though Michaud notes that it has become more selective in its building choice. Additionally, Voya “continues to fund multifamily loans – in part because of signs the sector will perform well despite rising unemployment, and also because it enjoys deep support from the government sponsored enterprises.” In the near term, Voya is busy helping CMBS borrowers who have found themselves in trouble, specifically those left in limbo as markets seized in March. “We’ve been doing a lot of stranded loans” Michaud said.
Voya Chief Investment Officer for Fixed Income Matt Toms was on Bloomberg TV discussing debt markets and what factors are likely to have an impact in the future. Looking forward, Toms said, “in our view, it’s unlikely that [the Federal Reserve] needs to specifically use yield curve control ... the market is saying the Fed is near zero for an extended period, beyond 2-3 years all the way out to that 5 year bond. It’s only at the very back end with that 30 year where you see the real steepening, so bond markets are saying we could stay at a low level for a very long time.”
Voya Investment Management Head of Securitized Dave Goodson was quoted by GlobalCapital as it looks at how the pandemic and subsequent economic shock have impacted the asset-backed securities market. Many asset issuers have adopted forbearance as “an integral part of ... relief plans to buy some time for their clients to recover.” However, Goodson believes that it remains unclear what direction the economic recovery will take and “the key question is how forbearance translates into real, observed delinquencies” in the market. Looking at specific sectors such as aviation that have been particularly hard hit, Goodson believes that “there will be a return to normal at some point when a vaccine arrives, but the road to that point will be difficult.”
Voya Investment Management CIO Paul Zemsky spoke with CNBC about current market conditions as stocks pull back on concerns of another wave of the coronavirus. Zemsky does not believe the day’s retreat marks the start of a full-fledge downturn in the market, saying, “I really don’t think we’re heading for a 50% retracement, but the market is up 45% from the bottom here in the S&P. That’s a really big move. It’s perfectly natural to have a retracement. A 10% retracement from here will take us back to 2,900. And that was where we were in mid-May, so less than a month ago where 2,900 we would have been really happy to get here, so it’s perfectly normal to have a retracement after a rally like this.”
Voya Investment Management Chief Investment Officer for Multi-Asset Strategies Paul Zemsky was on MoneyLife With Chuck Jaffe discussing stock and bond markets. Zemsky believes that with the market near record highs despite earnings that are below expectations, it’s not surprising that many observers think that stocks are overvalued now. He doesn’t see things that way, however, noting that stocks are a good opportunity – especially small caps and international stocks which have been the laggards in the recent rally – while lightening up on bonds, except for corporates where he sees some improved return potential ahead.