Who's Next? Meet The Junk Bonds That Are One CoreWeave Away From Distress

CoreWeave's bonds are now trading like a distressed credit. The more interesting question is who else is.

For the third day in a row, CoreWeave paper traded in deep distressed levels, starting the day in freefall bfore recovering to close above 80 cents on the dollar, with the yield-to-worst on its 9.625% notes due 2032 closing the day around 14%. Reuters reported the April-issued 2031s also yielding above 16%, "a level that typically signals distress," a day after five-year CDS closed at a record 1,117bps, implying roughly 63% odds of default within five years. The bonds clawed back part of the damage by midday, and then came the cheerleading from none other than Jensen Huang:

Crowding Out, One Marginal Borrower At A Time