* Lawmakers in Slovakia struck a deal on Wednesday to ratify
a plan to bolster the euro zone’s rescue fund by Friday,
effectively ending a crisis that had threatened the currency’s
main safety net. Slovakia is the only country in the 17-nation
bloc left to approve the revamp of the fund.* Adding to the sense of urgency, the President of the
European Commission, Jose Manuel Barroso, said Europe needed to
take decisive action on Greece and outlined a broad plan to
contain the debt crisis.* Ten-year notes nudged up 3/32 in price to yield 2.047
percent , barely changed from late U.S. levels. The
10-year yield was not far from a six-week high of 2.2710 percent
marked at one point on Wednesday.* The improvement in risk sentiment diminished the appeal of
benchmark 10-year Treasury notes at Wednesday’s $21 billion
auction, attracting weak demand with the yield above pre-auction
rates. The bid-to-cover ratio, a gauge of demand which compares
total bids with the amount offered, was 2.86, the weakest since
November 2010.* Support for 10-year Treasuries lies at roughly 2.3
percent, near a series of daily peaks hit in late August to
early September. In addition, the 38.2 percent retracement of a
July to September rally in 10-year notes lies near 2.266
percent.* The Treasury department will sell 30-year bonds at 1700
GMT. It will announce weekly 3- and 6-month bill sales, along
with 52-week bill and 30-year TIPS sales, at 1500 GMT.* Traders said they did not want to take more aggressive
bets ahead of a major EU summit on Oct. 23, where hopes are
mounting that euro zone authorities will unveil a comprehensive
strategy to fight the region’s debt crisis.
Credit default swap (CDS) spreads on Alcoa Inc. (reporting tomorrow) have gapped
out 250 basis points (138%) over the past three months. Alcoa is now trading in
below investment grade territory. Additionally, CDS liquidity for Alcoa is
trading in the second regional percentile. ‘Market scrutiny for Alcoa is likely
being driven by its vulnerability to continued slow recovery of developed
nations, keeping demand for metals low,’ said Author and Director Diana
Allmendinger.Elsewhere, CDS on JPMorgan Chase & Co. (reporting Thursday) have widened 95% to
trade at ‘BBB’ levels. CDS liquidity for JPMorgan has also increased to the 13th
regional percentile from trading in the 25th. ‘The sputtering economy has
heightened market uncertainty across all financial institutions in recent
weeks,’ said Allmendinger.ALCOA Inc. (BASIC MATERIALS/Industrial Metals)Credit spreads have widened over the last three months, with the five-year point
widening from 181 bps to 431 bps, an increase of 138%. The liquidity score on
ALCOA Inc. decreased from 6.87 to 6.25 over the three-month period, causing an
increase in liquidity from trading in the third percentile to the second
percentile.HCA Inc. (HEALTH CARE/Health Care Equipment & Services)Credit spreads have widened over the last three months, with the five-year point
widening from 410 bps to 708 bps, an increase of 73%. The liquidity score on HCA
Inc. decreased from 7.23 to 6.81 over the three-month period, causing a decrease
in liquidity from trading in the 12th percentile to the 13th percentile.Host Hotels & Resorts, Inc. (FINANCIALS/Real Estate Investment Trusts)Credit spreads have widened over the last three months, with the five-year point
widening from 215 bps to 511 bps, an increase of 138%. The liquidity score on
Host Hotels & Resorts, Inc. decreased from 8.53 to 8.38 over the three-month
period, causing a decrease in liquidity from trading in the 52nd percentile to
the 53rd percentile.JPMorgan Chase & Co. (FINANCIALS/Banks)Credit spreads have widened over the last three months, with the five-year point
widening from 82 bps to 159 bps, an increase of 95%. The liquidity score on
JPMorgan Chase & Co. decreased from 7.57 to 6.81 over the three-month period,
causing an increase in liquidity from trading in the 25th percentile to the 13th
percentile.Pepsico, Inc. (CONSUMER GOODS/Beverages)Credit spreads have widened over the last three months, with the five-year point
widening from 38 bps to 53 bps, an increase of 38%. The liquidity score on
Pepsico, Inc. decreased from 8.05 to 7.52 over the three-month period, causing
an increase in liquidity from trading in the 39th percentile to the 35th
percentile.The Progressive Corporation (FINANCIALS/Nonlife Insurance)Credit spreads have widened over the last three months, with the five-year point
widening from 92 bps to 112 bps, an increase of 21%. The liquidity score on The
Progressive Corporation increased from 9.43 to 10.74 over the three-month
period, causing a decrease in liquidity from trading in the 68th percentile to
the 82nd percentile.Safeway Inc. (CONSUMER SERVICES/Food & Drug Retailers)Credit spreads have widened over the last three months, with the five-year point
widening from 115 bps to 115 bps, an increase of 0%. The liquidity score on
Safeway Inc. decreased from 7.42 to 6.77 over the three-month period, causing an
increase in liquidity from trading in the 19th percentile to the 12th
percentile.Additional insightful market data and analysis is available at
‘
Credit default swap (CDS) spreads on Alcoa Inc. (reporting tomorrow) have gapped
out 250 basis points (138%) over the past three months. Alcoa is now trading in
below investment grade territory. Additionally, CDS liquidity for Alcoa is
trading in the second regional percentile. ‘Market scrutiny for Alcoa is likely
being driven by its vulnerability to continued slow recovery of developed
nations, keeping demand for metals low,’ said Author and Director Diana
Allmendinger.Elsewhere, CDS on JPMorgan Chase & Co. (reporting Thursday) have widened 95% to
trade at ‘BBB’ levels. CDS liquidity for JPMorgan has also increased to the 13th
regional percentile from trading in the 25th. ‘The sputtering economy has
heightened market uncertainty across all financial institutions in recent
weeks,’ said Allmendinger.ALCOA Inc. (BASIC MATERIALS/Industrial Metals)Credit spreads have widened over the last three months, with the five-year point
widening from 181 bps to 431 bps, an increase of 138%. The liquidity score on
ALCOA Inc. decreased from 6.87 to 6.25 over the three-month period, causing an
increase in liquidity from trading in the third percentile to the second
percentile.HCA Inc. (HEALTH CARE/Health Care Equipment & Services)Credit spreads have widened over the last three months, with the five-year point
widening from 410 bps to 708 bps, an increase of 73%. The liquidity score on HCA
Inc. decreased from 7.23 to 6.81 over the three-month period, causing a decrease
in liquidity from trading in the 12th percentile to the 13th percentile.Host Hotels & Resorts, Inc. (FINANCIALS/Real Estate Investment Trusts)Credit spreads have widened over the last three months, with the five-year point
widening from 215 bps to 511 bps, an increase of 138%. The liquidity score on
Host Hotels & Resorts, Inc. decreased from 8.53 to 8.38 over the three-month
period, causing a decrease in liquidity from trading in the 52nd percentile to
the 53rd percentile.JPMorgan Chase & Co. (FINANCIALS/Banks)Credit spreads have widened over the last three months, with the five-year point
widening from 82 bps to 159 bps, an increase of 95%. The liquidity score on
JPMorgan Chase & Co. decreased from 7.57 to 6.81 over the three-month period,
causing an increase in liquidity from trading in the 25th percentile to the 13th
percentile.Pepsico, Inc. (CONSUMER GOODS/Beverages)Credit spreads have widened over the last three months, with the five-year point
widening from 38 bps to 53 bps, an increase of 38%. The liquidity score on
Pepsico, Inc. decreased from 8.05 to 7.52 over the three-month period, causing
an increase in liquidity from trading in the 39th percentile to the 35th
percentile.The Progressive Corporation (FINANCIALS/Nonlife Insurance)Credit spreads have widened over the last three months, with the five-year point
widening from 92 bps to 112 bps, an increase of 21%. The liquidity score on The
Progressive Corporation increased from 9.43 to 10.74 over the three-month
period, causing a decrease in liquidity from trading in the 68th percentile to
the 82nd percentile.Safeway Inc. (CONSUMER SERVICES/Food & Drug Retailers)Credit spreads have widened over the last three months, with the five-year point
widening from 115 bps to 115 bps, an increase of 0%. The liquidity score on
Safeway Inc. decreased from 7.42 to 6.77 over the three-month period, causing an
increase in liquidity from trading in the 19th percentile to the 12th
percentile.Additional insightful market data and analysis is available at
‘
