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Corporate Credit Risk: Investment Grade Best Levels Since mid-Feb


Friday sees the fifth consecutive session of improved corporate credit risk, new lows for March as investment grade risk measured by Markit's CDXIG5 index declines -0.681 to 64.631 -- brings index back to February 10 levels as stocks have a constructive end to the week: SPX eminis +22.5 (0.51%) at 4424.5 -- through key resistance of 4410.0, 50D EMA.

  • Markit's CDXHY5 high yield index mildly higher at 105.721 (+.062).
  • Carry-over support for socks after China indexes rallied on hopes of policy rate cut. Traders also cited triple witching expiration buying/squaring, and technical support as SPX eminis trade through first resistance.
  • Outperforming sectors (tighter or least wide) includes: Consumer Discretionary (-2.8) as resorts and airline stocks traded strong, ecommerce companies JD.Com and Alibaba rebounding w/China shares in general.
    Subordinated Financials and Consumer Staples both (-2.0), banks faring well while Voya Financial CDS narrowed 32.0.
  • Lagging sectors (wider or least narrow): Health Care (-1.1) with a broad swath of insurance provider debt underperforming. Technology (-1.4).

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