Derivs - Credit

The European Union looks to have hit a big setback with its drive to overhaul financial market rules, after accepting that it will have to delay rolling out its MiFID II legislation framework – and possibly by as much a year.

With European credit markets having stabilised and many participants believing that the worst of the year is over, there has been an increase in index options selling this week, said traders.

It is a truism that the finances of countries, as well as companies, feel the impact from declining commodity prices. This can be good for energy importing nations, and the positive effect on consumption can boost economic growth.

The Financial Stability Board has reported progress in implementing over-the-counter derivatives market reforms, but has also highlighted where it believes further work is needed and is seeking further market feedback.

Options and swaps market price action suggests that foreign investors are starting to believe that the macroeconomic and political risks for Brazilian assets have found a bottom.

BNP Paribas’ former co-head of fixed income has resurfaced at New York headquartered M&A advisory shop Foros as a senior advisor.

The flying cars and self-drying suits that Marty McFly discovered on October 21, 2015 in Back to the Future may not exist, but self-recovering auto credit spreads have been in evidence over the past week – taking Europe’s big carmakers back to the levels they enjoyed in September before the Volkswagen emissions scandal.

As overall credit market liquidity has eroded, total return swaps (TRS) are providing an alternative for market participants to access or hedge their corporate bond exposure, according to financial information services provider Markit.

Deutsche Bank will close several businesses in its global markets division, including market making in uncleared credit default swaps, uncleared interest rate swaps with dealers, agency RMBS trading and high risk weight securitized products trading.

BNP Paribas has hired an experienced financials credit trader to its London operations.

US federal regulators have approved a rule that will impose greater margin requirements on swaps that are not cleared through a clearing house, but have amended it to be less onerous for some transactions.

European Central Bank president Mario Draghi said on Thursday he was prepared to cut interest rates and ramp up quantitative easing, creating a credit market rally that sent iTraxx Europe and Crossover indices back inside their levels before the end of September spike in volatility.