02 February 2016 by lberuti
The better tone that we had most of last week seems a distant memory, and with oil closing again on $30 per barrel, investors do not feel at ease. Buyers of protection were out in force in the CDS market. They targeted indices, but single reference entity CDS were also aggressively, primarily high beta names such as miners and commodity related corporates. Autos were also under pressure and reached new recent wides – even lower yielding names so their risk premia trade up with BMW ( Bayerische Motoren Werke AG ) and DAIGR ( Daimler AG ) both 6bps wider at 110.5bps and 98.5bps respectively – like FIAT ( Fiat Chrysler ) for instance. Despite the announcement by the company of sales numbers in the US which surprised on the upside (Januray sales growth was +6.9% vs -0.1% expected) which caused a knee-jerk tightening at midday, the name soon resumed its drift towards wider levels, caught in the general poor sentiment.