Winehole23
01-21-2009, 01:16 AM
CDS report: Sovereigns rattle markets (http://ftalphaville.ft.com/blog/2009/01/20/51412/cds-report-sovereigns-rattle-markets/)
Posted by Adelene Lee, FT on Jan 20 12:13.
Credit market indices were wider on Tuesday morning, weighed down by growing fears about the stability of the Eurozone economies, as the cost of buying credit protection for the sovereign debts of the UK, US, Ireland, Spain, Austria and Germany all hit fresh highs on Tuesday morning. The downgrade (http://www.ft.com/cms/s/0/40719b56-e691-11dd-8e4f-0000779fd2ac.html) of Spain’s sovereign debt rating to AA+ from AAA by Standard & Poor’s on concerns about its public finances, as well as the UK government’s second bank bailout, has rattled confidence in European economies.
The cost of buying five-year credit protection on the UK gapped wider to 133bp on Tuesday, compared to Monday’s close at 124.9bp. Ireland was out at 281bp from 275.2bp yesterday, Spain was at 156.3bp, compared to 142.5bp, Austria climbed to 157.5bp from 146bp and Germany edged wider to 55.8bp from 55bp on Monday, according to CMA.
And despite optimism for US president-elect Barack Obama’s inauguration this afternoon, five year CDS for the world’s largest economy also inched wider to around 70bp, from 69bp yesterday. Investors are waiting for more information on the 44th president’s plans for the banking sector and the economy.
In the broader markets, the iTraxx Europe high grade index moved out to 165bp-168bp this morning from Monday’s close of 163bp, while the iTraxx Crossover Europe index of junk-rated companies was at 995bp-997bp from 980bp yesterday, according to a trader.
Banking groups Anglo-Irish Bank, ING and Abbey National were the biggest underperformers. Investors are still reeling from the UK’s second bank bailout announced on Monday, when an estimated £17.5bn of value was wiped off UK bank shares.
The cost of buying credit protection surged 50.1bp to 397bp for Anglo Irish Bank, and CDS spreads for its peers ING and Abbey National, rose by 24.8bp and 16.2bp to 180.8bp and 106.2bp, respectively, according to CMA.
Posted by Adelene Lee, FT on Jan 20 12:13.
Credit market indices were wider on Tuesday morning, weighed down by growing fears about the stability of the Eurozone economies, as the cost of buying credit protection for the sovereign debts of the UK, US, Ireland, Spain, Austria and Germany all hit fresh highs on Tuesday morning. The downgrade (http://www.ft.com/cms/s/0/40719b56-e691-11dd-8e4f-0000779fd2ac.html) of Spain’s sovereign debt rating to AA+ from AAA by Standard & Poor’s on concerns about its public finances, as well as the UK government’s second bank bailout, has rattled confidence in European economies.
The cost of buying five-year credit protection on the UK gapped wider to 133bp on Tuesday, compared to Monday’s close at 124.9bp. Ireland was out at 281bp from 275.2bp yesterday, Spain was at 156.3bp, compared to 142.5bp, Austria climbed to 157.5bp from 146bp and Germany edged wider to 55.8bp from 55bp on Monday, according to CMA.
And despite optimism for US president-elect Barack Obama’s inauguration this afternoon, five year CDS for the world’s largest economy also inched wider to around 70bp, from 69bp yesterday. Investors are waiting for more information on the 44th president’s plans for the banking sector and the economy.
In the broader markets, the iTraxx Europe high grade index moved out to 165bp-168bp this morning from Monday’s close of 163bp, while the iTraxx Crossover Europe index of junk-rated companies was at 995bp-997bp from 980bp yesterday, according to a trader.
Banking groups Anglo-Irish Bank, ING and Abbey National were the biggest underperformers. Investors are still reeling from the UK’s second bank bailout announced on Monday, when an estimated £17.5bn of value was wiped off UK bank shares.
The cost of buying credit protection surged 50.1bp to 397bp for Anglo Irish Bank, and CDS spreads for its peers ING and Abbey National, rose by 24.8bp and 16.2bp to 180.8bp and 106.2bp, respectively, according to CMA.