Earnings season is well underway and the Federal Reserve is set to end its bond purchase programme, but in Europe all eyes were on the results of the ECB’s asset quality review and stress tests. A total of 25 banks out of 130 failed the tests, though only 13 banks have capital shortfalls once prudential…

If there was any doubt that credit markets are dependent on central banks for their sustenance, then events this weeks would surely have laid them to rest. All it took was a report that stated the ECB is considering buying corporate bonds in the secondary markets, possibly as soon as the first-quarter of next year….

The global macro picture remains a concern, but credit investors will turn their attentions to micro factors over the next few weeks as earnings season gains momentum. US banks, as usual, will set the tone, and so far the indications are that results will be mixed. JPMorgan’s third-quarter net income of $1.36 per share was…

We remarked last week that volatility had returned to the credit markets, and the spread oscillations this week suggests the trend is set to continue. However, this was no typical period for CDS.The vast majority of indices rolled on October 6th, later than the scheduled date of September 22nd, due to delays in adherence on…

Credit markets are now accustomed to low volatility, but there were signs over the third-quarter that the climate is changing. North American CDS, as represented by the Markit CDX.NA.IG index, traded in a relatively broad range during the quarter. The index hit 55bps in early July, its tightest level since October 2007…. Login to Read More...

“The silent have spoken,” said Alistair Darling, referring to the convincing victory for the pro-Union campaign in the Scottish referendum…. Login to Read More...

The United Kingdom may be on the verge of breaking up, but the credit markets are either sanguine about Scotland gaining independence or discounting the possibility altogether. Spreads have widened since a poll earlier this month indicated the ‘Yes’ camp had a slender lead in the polls…. Login to Read More...

Argentina’s interminable struggle with bondholders continues, but at least one element of the saga has reached a resolution. The credit event auction was held on September 3, and the final price was determined as 39.5. As we can see from the chart,this was in line with market expectations. Markit’s composite recovery rate was around 40%…

Russia and India have long had a close relationship, going back to the days of Nehru and Khrushchev. But, though links between the two countries remain tight, the same can’t be said of their relative creditworthiness…. Login to Read More...

The micro issues of Argentina and Banco Espirito Santo have garnered most of the attention in the CDS market of late, but as the summer draws to a close the discourse is shifting back to the macro picture. On the face of it, the change in focus could be a negative development. The eurozone economy…