Summary
More positive tone in the credit market but still low activity in the primary market
Headlines from the credit market this week
Greek refinancing risk fell substantially after the country successfully issued a EUR5bn 10Y bond on Thursday, which calmed down the market with spreads generally moving tighter. As expected in this environment, bank and sovereign CDS spreads have significantly outperformed non-financials (see graph below). iTraxx Europe currently trades at 80bp whereas Crossover trades at 440bp which for both indices is a meaningful tightening from last week. Cash spreads have also tightened slightly.
