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Traders bought two-month double no-touch options on the Japanese yen/U.S. dollar pairing early last week, said a trader in Tokyo. Betting that the yen would stay range-bound, the binaries have ceilings at JPY116 and floors at JPY125, he noted. Some traders bought one- to two-month dollar calls struck at JPY121 with knockouts at JPY116, he said. One-month options volatility hovered around 13%, relatively unchanged from the week before.

One-year credit default protection levels on the Republic of Turkey fell to 370 basis points/420bps on Thursday from 525bps/625bps the week before. A London-based trader said it was the first time investors entered the market since the Turkish crisis late last year. Interest came from private clients and was split between selling protection and buying credit-linked notes. In the credit-linked notes, the issuing banks sold protection to hedge the credit exposure embedded in the notes. Investors were buying short-end protection because this is the first part of the curve to regain liquidity after a crisis--it is seen as the least risky.

Michael Stewart, a marketer in interest-rate derivatives at BNP Paribas in New York, has taken the new position of director-corporate interest-rate derivatives marketing at Westdeutsche Landesbank Girozentrale in New York. The position was added because the bank has extra business in the area now. The Financial Accounting Standards Board's Statement Number 133 has spurred corporates to re-examine their hedging activity, and WestLB has particular expertise in that arena, according to David Kwun, executive director and head of corporate derivatives sales. Stewart, who reports to Kwun, declined comment.

ABN AMRO Bank in the next several months is moving a team of about four traders covering U.S. equity derivatives to New York from London. The move is designed to combine the trading group with a marketing team already in the U.S. Having traders on the ground makes working with marketers easier logistically, and brings them closer to the market and market information, said Eelco Rooimans, global head of equity derivatives trading in London.

AMP Shopping Centre Trust, an Australian property trust with some AUD1 billion (USD556.1 million) in assets, this month entered a fixed-to-floating interest-rate swap on a AUD50 million four-year fungible bond. It entered the swap to retain a balance of fixed- and floating-rates in its debt portfolio, said Michelle MacPherson, treasury manager for listed trusts at AMP in Sydney, noting that AMP prefers to pay fixed on 60-80% of its various property trusts' debt and floating on the rest. AMP Shopping Centre Trust has just over AUD300 million in debt, she said, declining to break down the maturities and interest rates on that debt or the size of the trust's derivatives book.

Activity in the European credit default swap market surged last week, notably in telecom names as market participants awaited a EUR4 billion (USD3.699 billion) convertible bond issue this week from France Telecom. Contrary to expectations, five-year credit default swap prices on the name actually fell from 160 basis points to 135bps because of a surfeit of sellers, said traders.

One-month euro/U.S. dollar implied vol surged upward last week to around 14% from a low the previous week of 12.75% as the euro showed signs of losing footing against the dollar in the spot market. The euro drifted downward from its high early this month of around USD0.95, hitting USD0.9220 toward the end of the day Wednesday.

BNP Paribas is expanding its alternative risk transfer product line into Asia, planning to offer weather derivatives and insurance and accounting-related products later this year from Hong Kong. It is looking to hire a dedicated marketer/structurer in Hong Kong, said Hikaru Ogata, head of derivatives marketing-Asia. The move represents a natural expansion of the group's reach, he said, noting that it also plans to set up a weather derivatives desk in New York this summer (DW, 1/7). BNP Paribas has been marketing weather derivatives in Europe since May last year.

Marc James, managing director-corporate fixed-income derivatives marketing at Bear Stearns in New York, has taken the new position of head of fixed income and credit derivatives marketing at Commerzbank Securities in New York. Several market players expressed surprise at the move, noting that Commerz has a low profile in U.S. fixed income derivatives. Others said the new position gives James, the opportunity to build a business. James could not be reached for comment.