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CDS Movers
CDS Improvers - 21 August 2008
| Ticker | CLIP | Name | Doc Clause | 5Y Today | Daily Chg (bp) | Weekly Chg (bp) | 28 Day Chg (bp) |
|---|---|---|---|---|---|---|---|
| KAZ | Y29ECH | Kazkommertsbank JSC | CR | 777 | -22 | -59 | 54 |
| DOL | 27BC65 | Dole Food Co Inc | XR | 972 | -10 | -31 | -144 |
| KAZAKS | 4CECC7 | Rep Kazakhstan | CR | 245 | -8 | -7 | 32 |
| CONTI | 2D17E8 | Contl AG | MM | 270 | -8 | 4 | 7 |
| YASUFI | JQD82T | Sompo Japan Ins Inc | CR | 65 | -6 | -9 | 7 |
| SUMIRD | JQEFEB | Sumitomo Rlty & Dev Co Ltd | CR | 276 | -4 | -7 | 28 |
| YAMAHA | JSECED | YAMAHA Mtr CO LTD | CR | 47 | -4 | -8 | -1 |
| CIBN | HI57CO | Ciba Hldg Inc | MM | 296 | -3 | 43 | 55 |
| VENZ | 9B48AA | Rep Venezuela | CR | 592 | -3 | -25 | 23 |
| LEN | 5H865C | Lennar Corp | MR | 893 | -3 | 70 | 187 |
KAZ / KAZAKS - Kazakhstan's credit spreads, having widened in response to the conflict between Russia and Georgia, are now falling back. Russia has yet to pull back from Georgian territory and the West has taken a more aggressive tone in recent days. Fears that the conflict could spread beyond Georgia led to the cost of protection in Russia's neighbours to widen.
DOL - Dole Food's spreads tightened yesterday on no firm news. The fruit and vegetable company has been trading upfront for some time, indicating probability of near-tern distress. Investors are concerned about its ability to redeem a $350 million 2009 bond. Dole had negative cash flow for the first-half of 2008 and its high leverage could mean that it will face difficulty in refinancing.
CONTI - German automotive supplier Continental was one of the few tightening credits in Europe yesterday. The company announced that it had reached an agreement with investment group Schaeffler that will see the latter firm take a maximum 49.99% in Continental. Schaeffler has agreed that it will not change the dividend policy or increase the debt to equity ratio against the wishes of the board. However, Schaeffler's stake is significant and could presage a move towards a more shareholder friendly financial policy in the medium-term. Continental needs to deleverage following its VDO acquisition and the wide level of its spreads reflects investors concerns over management's ability to deliver.
YASUFI - Sompo Japan tightened on no firm news. The broader Japanese credit market continued to widen in response to financial market jitters in the US.
CDS Deteriorators - 21 August 2008
| Ticker | CLIP | Name | Doc Clause | 5Y Today | Daily Chg (bp) | Weekly Chg (bp | 28 Day Chg (bp) |
|---|---|---|---|---|---|---|---|
| GLTNR | XA37FV | Glitnir banki hf | MM | 868 | 84 | 106 | -132 |
| KAUPBN | XB776W | Kaupthing banki hf | MM | 775 | 37 | 78 | -229 |
| LEA | 5H39EB | Lear Corp | MR | 985 | 33 | 68 | 212 |
| MDPAC-SKF | GOA86F | Smurfit Kappa Fdg plc | MM | 506 | 26 | 31 | 108 |
| LANISL | X1BD7U | Landsbanki Is H F | MM | 489 | 21 | 22 | -177 |
| SLMA | 7FC86R | SLM Corp | MR | 485 | 20 | 50 | 43 |
| COF | 1F444H | Cap One Finl Corp | MR | 452 | 19 | 52 | 67 |
| GENP | FMDCAQ | Rallye | MM | 669 | 19 | 24 | 49 |
| SPGIM | T1BB8H | Seat Pagine Gialle SpA | MM | 962 | 19 | 8 | 131 |
| AIG | 028EFB | Amern Intl Gp Inc | MR | 367 | 18 | 66 | 138 |
GLTNR / KAUPBN / LANISL - Icelandic banks, long the most volatile among European financials, widened as par of a broader move in the sector. Spreads in Glitnir, Kaupthing and Landsbanki rallied this month as speculation receded about their near-term future. Yesterday, however, negative sentiment in the sector saw them resume their widening. The composite eurozone PMI, produced by Markit and RBS, rose modestly but remained at levels indicating economic contraction. The report gave bears on the eurozone economy more ammunition. Uncertainty surrounding Fannie Mae and Freddie Mac has also weighed on spreads. Rumours abound that the government may be forced to step in and secure the GSEs' future. Until the situation is resolved it will cause more volatility in financials.
LEA - Spreads in auto parts supplier Lear Corp are approaching the 1,000bp mark amid a resurgence in oil prices. The price of crude moved beyond $120 a barrel for the first time since the beginning of this month, with geopolitical concerns and a falling dollar driving the increase.
MDPAC-SKF - Smurfit Kappa's spreads widened in a mixed session for US high yield credit. The Markit CDX HY index was marginally tighter, tracking the stock market, but most of the constituents were wider.
