EM Credit Index Tightening Surprises

The CDX emerging markets index surprised traders by tightening to a three-month low last week, despite the escalating conflict in the Middle East.

  • 04 Aug 2006
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The CDX emerging markets index surprised traders by tightening to a three-month low last week, despite the escalating conflict in the Middle East. Five-year spreads tightened to 141 basis points Wednesday from 186 bps two weeks ago and 214 bps in June. Emerging markets credit derivative traders attributed the tightening to indications the U.S. Federal Reserve is nearly done tightening interest rates and the view that geopolitical risks--while making headlines--are under control.

"The market was positioned for disaster," said the head of one emerging markets trading desk. "It was very difficult not to be bearish the last few months. All you had to do was open the newspaper. But the markets were betting [the Middle East] would be less contained than it is." He added, however, "If [fighting] intensifies, all bets are off."

The conflict has even benefited big oil producers such as Brazil and Russia, which each make up 13% of the index, one trader noted. Five-year Brazil CDS tightened 60 bps since last month and Moody's Investors Service Monday indicated a potential upgrade.

  • 04 Aug 2006

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 24,891.71 88 7.80%
2 JPMorgan 23,552.91 80 7.38%
3 Barclays 22,049.34 45 6.91%
4 Goldman Sachs 17,809.03 44 5.58%
5 HSBC 17,636.79 61 5.53%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 HSBC 48,528.41 214 6.32%
2 Deutsche Bank 44,075.51 161 5.74%
3 BNP Paribas 41,452.79 240 5.40%
4 JPMorgan 37,278.65 134 4.85%
5 SG Corporate & Investment Banking 36,258.27 187 4.72%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Goldman Sachs 1,607.28 5 24.01%
2 Credit Suisse 1,301.65 4 19.45%
3 UBS 970.80 3 14.50%
4 BNP Paribas 522.35 4 7.80%
5 SG Corporate & Investment Banking 444.17 3 6.64%