Danske Research Team
Danske Bank A/S
What's on our mind
- General credit market news
Last week opened fairly cautiously on the back of the terrorist attacks in Paris. During the week risk sentiment improved with both equities and European credit indices performing well, more or less neglecting the ongoing turmoil and potential threats. The iTraxx Main index moved 2bp tighter ending at +72bp, while the high yield index, iTraxx Xover, tightened 15bp, closing at 297bp.
The risk sentiment was also boosted by the US and the European central bank. Although the FOMC protocol that was presented on Wednesday indicates a raise of the policy rate in December, the rate path is expected to be flat, which was well received by the market. On Friday Mario Draghi said in a speech that the ECB will do what it must to increase the inflation rate, signalling that there might be more to come from Draghi’s bazooka.
The primary market showed high activity with EUR24bn issued in Europe during the past week, split by EUR3.5bn in SSAs, EUR14.5bn in FIGs and EUR6bn in corporate issues. Year-to-date European issuance is 1% higher than the same period in 2014.
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