Daily commentary

It's been a quiet mixed open for credit this morning.  Global equities were down slightly while swap spreads are slightly tighter.  Yesterday's equity move pushed the Vix higher in one of the largest one day moves in quite some time.  

Today is a heavy day for economic data so we'll likely take our directional cues from something in this slew.

Despite yesterday's markets, new issues from Dupont, Union Pacific and Coca Cola Enterprises were all successfully placed.  For full details, type NIM3 on Bloomberg.  Deals from Roche and Ameren are being marketed this morning.  

The negative basis (the measure of rich/cheap between bonds and CDS of the same name) moved inside -200bps for the first time since October.  When the basis is negative, as it is now, that means that bonds are cheap to CDS.  As this number shrinks and approaches zero, that means bonds and CDS are approaching fair value (to each other).  This tells me that the 'hot money' (hedge funds and dealers) continues to close out their CDS positions.

Former Fed Chairman Greenspan, he of fading relevance and influence, opined on possibly nationalizing the banks.  

The cheapest or widest sectors in the corporate bond market are currently REITs, diversified financials, insurance, financials and consumer/retail.

The richest or tightest sectors are healthcare/pharma, industrials, telecom, utilities and energy.