Credit markets came under the spotlight on Friday as talk that a European fund was liquidating a structured credit product added to fears that economic slowdown would lead to companies defaulting on their debt.
The Markit iTraxx Europe index – a gauge of the cost of insuring against corporate default – hit a lifetime high of 98.75 while the CDX North America investment grade index touched 133. The iTraxx crossover index of mostly junk-rated credits – an important barometer of risk appetite – widened to a record 530.
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