• Most Popular
  • Most Shared

UPDATE 1-US high-grade CDS index tighter in volatile trading

Wed Oct 8, 2008 10:55am EDT

Stocks

   

(Adds moves after U.S. stock market open)

Stocks  |  Bonds

NEW YORK, Oct 8 (Reuters) - The main U.S. investment-grade credit default swap index fell on Wednesday in volatile trading, on hopes a coordinated global interest rate cut may help free up frozen credit markets.

The index tightened to about 177 basis points, from about 180 basis points on Tuesday, according to data from Markit Intraday. The index earlier had climbed as the stock market opened lower, reversing earlier declines as initial optimism about the rate cuts faded.

"The market has been very volatile. What I tell you right now will probably be different in half an hour," one trader said. "The rate cuts were definitely good news, but the trend has been investors are selling on the news. Things are jittery, but overall the rates cuts should help."

Credit spreads for insurance companies rallied on Wednesday in the wake of a series of rate cuts led by the U.S. Federal Reserve and global central banks.

Credit default swap spreads for companies such as XL Capital (XL.N), MetLife Inc (MET.N), Hartford Financial (HIG.N) and Prudential Financial Inc (PRU.N) all posted large gains, according to CMA DataVision data.

Five-year credit default swaps of XL Capital fell to 683 basis points, or $683,000 a year to protect $10 million of debt, down from 807 basis points on Tuesday, according to data from CMA DataVision. (Reporting by Ciara Linnane and Walden Siew; Editing by Theodore d'Afflisio)

Stocks
Bonds


More from Reuters

Joint Terminal Attack Controller SSgt Clinton J. Herbison, a U.S. Airman from the 817 Expeditionary Air Support Operations Squadron (EASOS) takes a break during a night mission near Honaker Miracle camp at the Pesh valley of Kunar Province August 12, 2009. Credit: REUTERS/Carlos Barria

Pictures of the Year

A look at the best photos of 2009.  Slideshow 

    PICTURES
    The Dalai Lama jokes with a nasal spray after being asked his opinion on the swine flu during a press conference after his first lecture in Lausanne, Switzerland, August 4, 2009. REUTERS/ Valentin Flauraud

    What a wacky year it's been...

    Um, what's up the Dalai Lama's nose? "Oddly Enough" editor Bob Basler rounds up the goofiest photos of the year.  Full Article 

    Oddly Enough
    A caution sign is seen next to a stock board at the Australian Securities Exchange (ASX) in Sydney September 5, 2008. REUTERS/Daniel Munoz
    Political Risk in 2010:

    Don't say we didn't warn you

    With the financial crisis (mostly) in the past, U.S. investors are eying a fresh start to the coming year. Here's a look at what speedbumps lie ahead.  Full Article 

    Global Markets