Paul J Davies
What Japan’s earthquake could mean for reinsurers – part two
A guest post in two parts by Paul J. Davies, the FT’s insurance correspondent. This is part two.
So, to the really interesting question, how long will any upswing last and what might it look like? Here’s a chart from Guy Carpenter,
What Japan’s earthquake could mean for reinsurers – part one
A guest post in two parts by Paul J. Davies, the FT’s insurance correspondent. This is part one.
There are two big questions for reinsurers following the Japan quake. Number one: will it put a floor under the weak pricing for catastrophe risk of recent years and even lead to sharp increases? Number two,
Which governments are really at risk of bankruptcy?
Everyone knows who are the sick men of Europe, right? Just look at the CDS markets to see which countries have the riskiest debt profiles: Greece wins hands down followed by Ireland some way behind.
But CDS traders might be systematically underestimating the riskiness of some of the traditionally more fiscally heavy-weight nations,
CDS update: US banks worsen
The cost of protecting US banks against default rose sharply on Tuesday afternoon UK time as investors in both equity and credit markets showed renewed signs of skittishness over the durability of bank earnings and over the upcoming results of the US “stress tests”.
CDS report: Rally gathering pace
European credit markets opened stronger once more on Thursday extending what has become a fairly consistent rally since the start of April for investment grade corporate debt especially.
Increasing numbers of analysts are coming out in favour of taking on greater risk in credit investment at the opening of the second quarter,
CDS report: UK financials fail to find support
Excitement over news that Barclays might not need government help and over the junior debt exchange offers from Lloyds and RBS failed to help UK banks and insurers in the European credit markets on Friday even as some of their continental counterparts saw muuchh more positive moves.
CDS report: Buy-backs boost sub debt
The cost of protecting junior bank bonds against default had a rare bout of better sentiment on Thursday after Lloyds Group added to the growing series of tender offers that are offering the most desperate investors an escape route while adding a marginal bid to the market.
CDS report: weaker once more
European credit markets weakened again on Wednesday after the previous days improvements as markets generally saw the glow added by Tim Geithner’s public-private investment programme fade more rapidly than even the cynics had expected.
CDS report: Pressure eases on insurers, carmakers
The European credit markets started the week on strong footing and consolidated on the rally that began last Wednesday as the insurers and carmakers especially among the companies that had led investment grade market wider saw much better performance.
CDS report: Better tone no help to insurers
European credit markets saw a strong decline in the cost of protecting many companies against default on Friday as the week’s rally in equity markets brought a bout of optimism back to debt investors too,
CDS report: Insurers lead market wider
Losses from Standard Life and Aegon, the UK and Dutch insurers, cast a pall over the sector in credit markets Thursday morning, leading to significant increases in the cost of protecting insurance and reinsurance company debt against default across Europe.
CDS report: Credit follows stock market lead
European credit markets took up the happier tone of stock markets on Wednesday after two days of ferocious risk disposal that saw the iTraxx Crossover list of mostly junk rated names hit an all-time high and the main investment grade index hit its highest since mid-December.
Fred Van Shred?
Amsterdam: the most civilised city in the world, some might say. Famously permissive (although no tobacco allowed in those reefers these days) and offering a tight social safety net for the disadvantaged.
The lot of the Irish
Who’d lend to Ireland? The Republic priced a 3-year €4bn deal Wednesday at 170bp over mid-swaps – pretty costly stuff! This spread is almost five-times that of Barclays’ UK guaranteed 3-yr £3bn deal this week,
CDS report: Banks under pressure
European banks remained under heavy pressure in credit markets on Monday as general concerns about financial weakness lingered and a further round of fears over the potential fates of junior bank bonds was awoken by UK government action on Friday.
CDS report: Emerging exposures hurt banks
Concerns over exposure to eastern Europe and other developing markets weighed on banks in both the credit and stock markets on Tuesday after a report from Moody’s, the rating agency, which added to the growing consensus that such countries would suffer more in the global economic downturn.
CDS report: RWE hit on Essent talk
RWE was the worst performer in broadly positive credit derivatives markets Monday morning, as the cost of protecting the German utility’s debt against default rose strongly on talk that it would announce a €10bn deal for Essent later in the day.
Glencore: time to come clean
OK, OK. Time to ‘fess up to my bad Glencore CDS call. Think I said below 1,000 basis points by Christmas. Well, after the first full day of the first proper week of the new year, it’s hovering at just above the 2,000bp mark.
CDS report: Christmas cheer
European credit markets showed a little Christmas cheer Thursday morning by extending their better performance of the past couple of days, though participants said volumes were thin.
There was little news to move the markets,
Glencore – capitulation?
Bit of a random post from me, but wanted to share the action in Glencore’s CDS price yesterday… after S&P downgraded the super-secret commods trader’s rating!
What? A big drop in its CDS due to a downgrade?! The move is partly down to the fact Glencore said it would buy back debt where investors were interested and made a sensible offer,
CDS report: Credit worse into year end
Credit derivatives countered the brighter mood in equity markets with a sharp increase in the cost of protecting corporate debt against default on Monday morning, though traders and analysts said the moves were driven mainly by technical factors such as hedging ahead of the quiet holiday period.
CDS report: Autos bail-out fails to buoy credit
Credit markets broke the better tone of recent days with a slide in confidence on Wednesday morning that pushed the cost of protecting corporate debt against default on the main European indices back above key levels.
CDS report: Governments under pressure
Just as credit derivatives markets were getting used to collapsing banks, billion dollar bailouts and recession, the threat of political and fiscal instability shot up the agenda.
Events in India overnight saw five-year credit default swap (CDS) spreads on the government-run State Bank of India widen 20 basis points to 440bp,
CDS report: Glass half full
European investment grade credit markets were positive Friday morning, but only just, as falling oil prices, profit warnings and sluggish stock markets bought a dose of reality back to the strong performance of the past couple of days.
CDS report: Rate cuts lift mood
Credit markets rallied strongly Thursday morning after the 50 basis point rate cut from the US Federal Reserve, cuts from China and Taiwan and indications from central banks that they would continue to act against recession boosted sentiment across markets.
CDS report: Japan rate move lifts credit
European credit markets opened strongly in line with stock markets after speculation overnight that the Japanese government would cut interest rates to limit the strengthening of the Yen, which has been driven higher by the rapid recent unwinding of the so-called carry trade.
CDS report: Brighter mood takes hold
European credit derivatives markets opened stronger for the first time in days on Tuesday morning, perhaps suggesting that the bout of recent deleveraging had run its course but more likely just following the bettter mood in stock markets in Asia,
CDS report: In a spin from global unwind
Credit markets suffered further from the global unwind that hammered Asian and European stock and currency markets on Monday morning as the nasty bout of risk aversion and deleveraging swept on unchecked.