Daily Archives: 24th March 2020

24th March 2020

🌄 First of Many False Dawns

iTraxx Main

99bp, -19bp

iTraxx X-Over

607bp, -98bp

🇩🇪 10 Yr Bund

-0.33%, +5bp

iBoxx Corp IG

B+261bp, +2bp

iBoxx Corp HY

B+883bp, -29bp

🇺🇸 10 Yr US T-Bond

0.82%, +5bp

🇬🇧 FTSE 100

6049.62, (-1.73%)
🇩🇪 DAX

12489.46, (-0.04%)
🇺🇸 S&P 500

3152.05, (-0.65%)

Timing is everything and nothing…

Are we reading this wrong? An extraordinarily positive day in equities, and a clutch at the proverbial straw of hope of a turnaround. There is a massive fiscal boost on the way in the US to augment the monetary one as well as the open-ended Fed purchases already announced. That will surely light the blue touch paper.

The virus will eventually be cured. And the ugly bit in the middle is an opportunity, isn’t it? That most likely will be determined on the shape of the recovery. The letters are all jumbled up, but the markets are pricing in a V-shaped recovery, not a U, W or L.

The borrowers hit the screens and investors piled in. The deals were cheap as chips. Irresistible. After all, the spread market had shifted/widened massively. It felt as if it was business as usual in the corporate bond market. New deal activity was bursting at the seams.

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