07 March 2018 by lberuti
Synthetic credit was re-racked wider at the open as most dealers were expecting a weak session with Gary Cohn announcing overnight he would leave the Trump administration. But if the prospect of escalating “trade wars” led to a muted start to the session, there was no real follow through and it was soon obvious that the market would shrug it off. Indeed, in a similar reaction to the seemingly negative results of the Italian election over the week-end, customers hardly sold any risk. Flows were not particularly heavy, and there was a decent amount of dispersion in risk premia’s behaviour, especially in the European Crossover space. TITIM ( Telecom Italia Spa ) outperformed once again in the wake of their numbers’ release - its 5-year CDS closed 4bps tighter at 118bps which is 10bps tighter since the beginning of the week -, while debt collectors underperformed. IJSS (Intrum Justitia AB) and GFKLDE (Garfunkel) were under pressure and closed 9bps wider at 312bps and 14bps wider at 645bps respectively, after Arrow Global Group Plc tapped some of their existing bonds at significant discounts compared with levels at which they were traded in the secondary market.