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All eyes were on the U.S. in October, mainly thanks to the 16-day government shutdown whichsaw many key services come to a halt, after the White House and Congressional Republicans failed to reach a deal over stop-gap budget measures needed to keep the government running. A last minute deal on October 16 to fund the government until mid-January and lift the debtceiling until February 7 was welcomed with sighs of relief across the globe.
CDS: Spreads on the iTraxx main index have been tightening steadily throughout the month with
only a few exceptions - the most notable one occurring between October 3 and October 9, when
mid spreads peaked at 101.7 basis points. The subsequent tightening of the index coincided with
the first signs of a political resolution in the U.S., reaching 83.4 basis points at month-end.
The Finsen index also tightened considerably during the month by 22.6 basis points, albeit
exhibiting higher volatility.
Cash: Selling was the dominant trend in October across all European cash credit markets, with
the exception of high yield, utilities and the T2 banking sector. Senior bank financials is still the
most highly traded sector; auto and construction, however, saw a decrease in traded volume
from the previous month.
only a few exceptions - the most notable one occurring between October 3 and October 9, when
mid spreads peaked at 101.7 basis points. The subsequent tightening of the index coincided with
the first signs of a political resolution in the U.S., reaching 83.4 basis points at month-end.
The Finsen index also tightened considerably during the month by 22.6 basis points, albeit
exhibiting higher volatility.
Cash: Selling was the dominant trend in October across all European cash credit markets, with
the exception of high yield, utilities and the T2 banking sector. Senior bank financials is still the
most highly traded sector; auto and construction, however, saw a decrease in traded volume
from the previous month.
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