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Japan Credit Unmoved

28 April 2016 by pdonnat

The Japan credit market was unmoved by the Bank of Japan holding off adding stimulus. The cluster of Japan CDS traded just 1bp wider on average. The Japan CDS Cluster is still and by far the tightest of our Machine Tree with an average spread of 68bps. At 70bps, the iTraxx Japan Series 25 is the tightest of the tradable investment grade credit default swap indices. Apart from Japan, the European banking sector was the most interesting today with DB CDS 5bps tighter post earning while Banco Novo CDS was much larger after the Administrative Lisbon Court provisionally decreed an injunction about one of the bond series transfer from Banco Novo to BES. In the US, oil CDS sector keeps tightening and the sector will be an outstanding performer in April 2016.