Daily Commentary

Credit spreads are tighter on the day as equity markets surge.  There is little else to talk about during this early-close-during-blackout-season type of day.  Same store sales seem to have a slightly better than expected bias with spreads performing in line with the general market.

Volumes are very light given the Big Bang and almost no new issuance (and a 2pm close so credit investors can honor passover/Maundy Thursday and pray for a bonus).

Tighter swap spreads, a subdued Vix and commodities and strong equity markets are more than enough to push spreads tighter.  Investors also seem to buoyed by the NYTimes article that the banks have passed the stress test.

Holders of insurance bonds/credit were certainly encourage by the TARP news.  However, some sobriety has crept into the conversation as they realize there's only ~$19B left for all of them (and loads of banks that have yet to apply).  

Berkshire Hathaway was dinged 2 notches by Moody's from AAA to Aa2.  CDS spreads were only  wider by ~10bps to ~340bps while the equity looks to be up on it's WFC holding (which announced strong earnings).  The finance sector is 20-35bps tighter today on this WFC news (MER and WFC performing the best).