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A Bright Spot During A Rough Session

04 February 2016 by lberuti

It was a volatile session in credit. An early attempt to drive risk premia tighter was short lived and the march wider resumed swiftly for most part of the session, barring a brief spell of aggressive short covering when the US came in (which brought credit indices to almost unchanged levels from 4bps and 15bps wider for iTraxx Main and iTraxx Crossover). Miners and metals did not participate in the widening though. GLEINT ( Glencore Plc ) was downgraded to the lowest investment grade rating by S&P, from BBB to BBB-, but most importantly their rating outlook is now stable. Investors breathed a huge sigh a relief and they sent GLEIN’s 5 year risk premium 111bps tighter at 840bps. It also benefitted AALLN ( Anglo American Plc ), MTNA ( ArcelorMittal SA ) and TKAGR ( ThyssenKrupp AG ) which all tightened meaningfully.