Markets are moving, and so are tariffs. After a holiday-shortened week in parts of the world, we return to markets dominated by shifting trade policy headlines. Tariffs are switched on and off, not all of them of course, and it sometimes feels like no one can fully keep track. Meanwhile, investors are taking a breather from AI and software risk and reacquainting themselves with the virtues of old-economy cash flows.
1. Global macro & headlines shaping markets
Geopolitical tensions remain and policy returns as market driver (once again)
Equities rode a roller-coaster of trade-policy news and geopolitical tension. After a dip on rising U.S.-Iran frictions (crude spiking to its highest level since August), the DOW, S&P 500 and Nasdaq closed the week in the green, helped by a Supreme Court ruling that struck down the reciprocal tariff regime. The decision briefly lifted 30-year Treasury yields.
The Trump administration then announced a 10% global tariff increase within hours, later nudged to 15%, keeping trade uncertainty alive…
Mixed macro data coming out of the US
Q4 2025 U.S. GDP grew at 1.4% YoY, below the expected outcome, while core inflation stayed a touch hotter than expected. Labor markets remain tight (initial claims at 206 k, the strongest weekly drop since November).
Geopolitical Tensions Keep Energy Markets on Edge
Renewed tensions in the Middle East, particularly involving US and Iran relations, pushed oil prices to their highest levels in months before stabilizing. Energy markets remain sensitive to geopolitical headlines, with supply disruptions representing a key upside risk for inflation. Persistent energy volatility could complicate the global disinflation trend
Structural Technology Shifts Are Reshaping Economies
Artificial intelligence and automation are increasingly influencing business investment and labour demand across sectors. Companies and investors are reassessing long-term profitability and competitive positioning in light of rapid technological change. The economic impact of AI is now viewed as structural rather than cyclical.
Leveraged Finance Market – 24/02/2026
Europe
Secondary markets were subdued last week as the UK half-term, U.S. Presidents’ Day holiday and Chinese New Year reduced trading activity and liquidity. In this environment, high-yield bonds traded broadly flat, edging slightly higher following tariff-related headlines, while performing leveraged loans gained around +0.25 points.
Demand remained concentrated in higher-quality credits, reflecting continued investor caution. By contrast, software and technology credits continued to trade down, as concerns around structural disruption and valuation pressures weighed on sentiment. Not all companies will be impacted but for Investors it will be key to understand the story and disruption risks.
Overall, market technical remain constructive, financing conditions not at the height seen previously but still supportive across both high-yield and leveraged loan markets.
Deal activity has been slower as usual due to the holiday period, highlights include:
ProAmpac, a US issuer active in the packaging sector, rated B3 / B- / B having its EMEA debut with a €425m Term Loan B, priced at E+4.00% / 98.50. To be fair, main tranche being a $3.8bn TLB landing at S+4.00% / 98.50. The deal incl. a privately placed 2L loan, similar to Hologic a few weeks ago. JP Morgan being the lead bank on this trade.
Arclin, another US issuer entering the European market for its EUR debut, is in market with a $1,225m Term Loan split between € and $. The issuer is rated B2 / B and pricing is rumoured in the S/E+425-450 / 98.0 area. Investors have concerns around cyclicality and leverage in this credit. The deal is led by Goldman Sachs
TK Elevator, a portfolio company of Advent and Cinven, and one of Europe’s largest LBOs, went to market with €1.5bn (equiv.) dual-currency (€/$) fungible add-on TLBs due 2030. The deal was launched with a price talk of S+275 @ 99.75 and E+300 / 99.5–99.75. The credit is rated B2 / B / B. Active banks incl. Citi on the USD and Barclays, Deutsche Bank, Goldman Sachs and UBS on the EUR tranche
Looking ahead we are aware of at least five to six sizeable underwritten transactions expected over the coming months. This incl. highlights like the BASF Coatings carve out, a large carve-out coming out of the Volkswagen construct and Castrol, which has been acquired by the US Sponsor Stonepeak.
America
U.S. Leveraged Finance activity moderated over the week, with high-yield issuance declining and leveraged-loan volumes remaining steady, reflecting a shortened trading week and ongoing macro uncertainty. Primary activity remained dominated by refinancing transactions, although acquisition-related financings continue to support the forward pipeline.
High-yield markets remained stable despite modest fund outflows, while leveraged loans saw limited price movement and modest inflows. Overall financing conditions remain supportive, similar to Europe there is a differentiation between credits and investors focus more on the quality. Lower quality deals can be done, however those potentially require a premium.
Deal activity is above those levels seen in Europe, as always, but lets focus on a few names only:
Vantor, a sponsor-backed industrial issuer, launched a $2.3bn 7-year Term Loan B priced at S+4.25–4.50% / 0% floor. Proceeds will be used to refinance an existing private Unitranche facility and repay preferred equity, marking a continued shift from private credit to syndicated loan markets
Michaels Cos (Apollo backed arts and crafts retailer) rated B2 / B-, issued a $2.0bn 7-year Senior Secured Notes at 8.50% and $750m 8-year 2nd lien SSN at 11.00%, alongside a $1.0bn 7-year Term Loan B. The transaction was primarily refinancing-driven and represents one of the larger multi-tranches leveraged financings this week. UBS and JP Morgan were leading the deal.
Genesis Energy, a US midstream energy issuer rated B2 / B, priced $750m 8-year Senior Unsecured Notes at 6.75%, tightening from initial price thoughts in the low-7% area. The transaction was used for refinancing purposes and demonstrated solid demand for mid-B rated energy credits
AMC Entertainment, the movie theatre operator, returned to markets with a $750m TLB, price talk is set at S+6.00% / 98.0. The loan is launched to refinance 2027 maturities, together with expected new notes.
Otherwise, we see jumbo activity coming back. Today Bloomberg and 9Fin reported that a JPMorgan Chase-led group is preparing a $5.3bn debt package to support Qualtrics’s $6.75bn acquisition of Press Ganey, with premarketing expected in the coming weeks and closing targeted around June. The financing is expected to include a $3.3bn syndicated TLB (including a euro tranche as well) alongside roughly $2bn of additional secured debt, potentially raised in the high-yield bond market.
The deal comes amid heightened investor caution toward software credits, as concerns about AI-driven competition weigh on sentiment despite limited evidence of credit deterioration. The transaction is being supported by a large bank group including JPMorgan, BMO, Citi, Deutsche Bank, Goldman Sachs, KKR Capital Markets, Mizuho, Morgan Stanley, RBC, UBS and Wells Fargo. This is certainly an interesting deal to watch and we will make sure to follow up on the outcome.
Outlook – what does 2026 have to offer?
One of the key questions for the year remains what the broader market environment has in store. While primary activity is no longer achieving the same outcomes as a few weeks ago, the market window remains open and supportive for issuers. Jumbo LBOs are returning, new-money deployment is the name of the game, and investors are competing to put capital to work, after all, management fees are driven by AuM, even if docs are loose and pricing is tight.
What raises more questions is the outlook for restructuring activity. While still largely sector-specific, the pace appears to be picking up, and it seems unlikely that both leveraged finance and restructuring teams will enjoy record-breaking years at the same time. Which side will stay busiest through the cycle remains to be seen.
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