Americas

The US regulatory framework offers little insight into the riskiness of hedge fund option portfolios, claimed treasury researchers this week, even as the industry reels from its worst year since 2009.

Banks continued to take advantage of the rally in high grade credit as Citigroup and Svenska Handelsbanken printed benchmark trades ahead of the Easter holiday.

Tata Steel is expected to offer banks a much higher return for a refinancing related to its Canadian operations than it paid for its recently concluded $1.5bn facility, according to sources.

The Republic of Paraguay was the only Latin American borrower to sell bonds in a short Easter week for much of the region, as conditions continue to improve for new issues.

A continued rally in Brazilian bonds is giving DCM bankers in São Paulo some hope that issuance from the country may be on its way — although it will not be a flurry and volatility looks set to remain high for some time.

A key area of derivatives focus in the planned merger between data firms Markit and IHS will be opening up Markit's credit default swap analysis to IHS corporate clients, according to sources with knowledge of the matter.

Credit derivative indices rolled into new series on Tuesday, with traders reporting a big long bias in the outgoing US and European investment grade indices among buyside participants that caused the new series to trade tighter than the level implied by fair value.

Investors continued to pour money into the US corporate bond market this week as March's rally in high grade bonds turned the market positive for the year.

Fitch upgraded Argentina's local currency rating from CCC to B on Tuesday thanks to an improved policy framework, and predicted it would do the same to the government’s foreign currency rating once the country resumes timely debt service on defaulted bonds.

Raizen Energia, the Brazilian sugar and energy producer, will buy back nearly $200m of debt after bondholders gave a solid response to a tender offer.

Evofem Holdings, a company backed by Invesco and Woodford Investment Management that is developing woman-controlled, hormone-free contraceptives, has abandoned an attempt to raise up to $200m of new money for the company by floating on Aim.

Credit index options prices have fallen so far following recent central bank moves that implied volatility measures are below trailing measures of realised volatility for the first time in four years.