Five Things You Need to Know to Start Your Day: Asia

Good morning. Concerns about private credit. The ongoing selloff in bonds. And a warning from Iran about nuclear policies. Here’s what’s moving markets. — Isabelle Lee

Moody’s Ratings this week gave investors greater reason for concern about credit quality in the $1.7 trillion private credit sector. The ratings firm reduced its outlook for direct lending funds managed by BlackRock, KKR, FS Investments and Oaktree Capital Management to negative from stable. These funds, which manage over $20 billion in assets, have seen an increase in loans on non-accrual status, indicating potential financial losses. While the funds retained their investment grade rating, the change to a negative outlook marks the first such move by Moody's in private credit since 2020.