To: Jon Koplik who wrote (7535 ) 1/24/2007 4:32:54 PM From: John Pitera Read Replies (1) | Respond to And Junk Bond Credit Spreads just get smaller and smaller. There is a dearth of concern regarding credit default and downgrade risk among too many yield hungry investors.Crossover index hits low , BA default swaps fall The iTraxx Crossover index, a barometer for risk sentiment , tightened 4.5 basis points to a 194 basis point mid-price, traders said, a record low level for the Series 6 contract and significantly below the psychologically key 200 basis point mark. very expensive credit market , and it could get even more expensive yet," said Georg Grodzki, a credit strategist at the Royal Bank of Canada. sufficient supply of credit risk for the demand out there , so we're going tighter. And equities are doing too well for there to be any blow-out in credit spreads takeover hopes in the utility and truck sectors and a firmer opening on Wall Street. The FTSEurofirst 300 <.FTEU3> index of leading European shares was 0.8 percent higher at 1,525.23 points by 1530 GMT. The iTraxx Crossover index has tightened over 10 percent since Jan. 5 , when it hit a wide level of 223 basis points, and nearly a third since Sept. 22, when it hit a wide level for the current contract of 292 basis points shortly after being launched. sequence of major adverse credit events , and that doesn't look very likely in the next few weeks," Royal Bank of Canada's Grodzki said. interest rate uncertainty may be keeping people out of the market at the moment."
