Taxable Fixed Income Commentary and Outlook 1Q2010

The favorable environment for risk assets held for the first quarter, with increasing confidence in the economic recovery, near-zero policy rates and continued improvement in credit conditions and earnings providing strong tailwinds. Capital market returns reflected this supportive backdrop and the higher appetite for risk with stocks adding to gains led by U.S. equities; while in the fixed income markets, credit continued its run of outperformance led by lower quality issuers and the Bank and Finance sector.