Derivs - Credit

It’s that time of the year again when CDS market participants turn their attention to technical, rather than fundamental, factors.

Real money investors remain the missing piece for index tranches of iTraxx Europe and Crossover, despite trading picking up and broadening in the asset class.

The decision to add 25 constituents to the iTraxx Crossover in September was a mistake, as it hasn’t increased the trading volume of single name credit default swaps as expected, according to market makers.

Morgan Stanley is set to lose a well-known senior trader from its London operation, according to market sources.

Investment management group Henderson Global Investors has added to its short but growing list of senior ex-Deutsche Bank credit staff in London with another hire.

This week, the Futures Industry Association held its 40th Annual Boca conference in Boca Raton, Florida where senior buysiders, sellsiders, exchanges, clearing houses, lawyers and other market officials met to dicuss the trading and regulatory landscape in the derivatives markets. The GlobalCapital team reported from the event, covering all the hot topics such as regional fragmentation, central counterparty equivalence, cross-border regulation, trading and execution requirements, and more.

Credit Suisse has suffered three recent departures from its credit trading business, with all three said to be heading to jobs elsewhere.

Central bank domination of financial markets entered another level this week with the commencement of full QE in Europe. There is little to suggest the spread compression it has caused across asset classes will continue.

When it comes to how banks finance their activities, there is little doubt we are in a new era. If anyone did question that the climate has changed, then a little known Austrian institution may have caused them to think again this week.

The European Court of Justice ruled on Wednesday that euro-denominated securities transactions can be cleared outside the eurozone, a victory for the UK, which brought the case against the European Central Bank.

It is a truism that the credit default swap product garners more headlines when companies default or are close to triggering a credit event. Last week we saw a typical example, and it will surely be the case next week as well.

Greek credit default swap spreads have tightened to their lowest point since the January election after the crisis over the country’s bailout seemed to recede once Germany agreed a bailout extension of another four months.