How should I understand the underlined?
Stock market volatility fell and risk appetite continued to increase, helping spreads narrow on lower-quality corporate bonds and high-yield debt.
'lower-quality corporate bonds' means bonds issued by a corporation on which there is a significant risk that the issuer will default (that is, be unable to pay the interest due the bondholder.)
'high yield debt' is debt upon which the lender will receive a better than average return (rate of interest) because there is a significant danger that the borrower will default.
What this sentence is saying is that because the lenders of money are now more willing to take the risk that borrowers will be unable to repay
them than they were before, the rate of interest a borrower has to be willing to pay is lower.
Please post again if this is still too difficult for you to understand.