Credits: Always look on the bright side…

Fitch Ratings declared their downgrade of Ireland, Wednesday, and the latest US job report missed the estimates. However, disappointing economic data from the US couldn’t contain the rally in credit markets today as the positive sentiment from yesterday showed little sign of dissipating.

“In fact, it is possible that the weaker than expected ADP employment report acted as a spur to risky asset.”

Gavan Nolan



The survey showed that the US private sector cut 39,000 jobs in September, easily missing expectations of a 20,000 gain. After Bank of Japan’s aggressive easing yesterday investors appear convinced that the Federal Reserve will follow with more quantitative easing, vice president Gavan Nolan at Markit Credit Research writes in his daily alert.

Gold is at record highs with investors seeing policy-induced inflation down the line.

A relatively strong ISM non-manufacturing report yesterday was viewed as no impediment to the FED taking further unconventional measures.

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“If the ADP report is a reliable indicator of non-farm payrolls – most would say it isn’t – then another set of weak data will give more ammunition to the QE proponents,” Gavan Nolan comments.

The Markit CDX IG index has outperformed relative to the Markit iTraxx Europe in recent days, with the basis between the two indices at its widest for some time. This narrowed slightly today as European markets took their cue from rallying US and Asian markets.

Sovereigns, however underperformed for a second day, not helped by a Fitch downgrade to Ireland.

The rating agency cut its rating one notch to A+, citing the “exceptional” cost of the bank bailouts. Fitch also placed it on negative outlook, warning of economic uncertainty and a possible weakening of political resolve.

Ireland’s spreads started the day about 13bp tighter at 425bp but the Fitch announcement led to its spreads widening out to 450bp.

Fitch Ratings Press Release.

“While unwelcome for the sovereign, it should be borne in mind that the downgrade had been more than priced in by the market. Ireland has an implied rating of single B, according to Markit data,” Nolan points out.

Markit BOAT – Equity Trading Highlights

Markit BOAT is a trade reporting platform which consolidates pan-European cash equity trade data from MTFs, Dark Pools and OTC transactions. The trading activity in this report took place on 5th October 2010 and was published by Markit BOAT on the same day. Trading activity reported with the “Market Condition” flag is excluded from this report. Such trading activity is not relevant because the trade price and/or trading process does not reference or correlate with the then current market price.

Unique Market Activity

The “Unique Market Activity” section lists stocks which were not active on Markit BOAT on the previous trading day.



Name Sector Volume Turnover €
TOSHIBA Industrials 8,194,000 29,292,518
TOYOTA MOTOR Consumer Goods 765,200 19,717,856
FASTWEB Telecoms 179,609 3,224,880
ALL NIPPON AIRWAYS Consumer Services 1,117,000 2,918,171
FIRST QUANTUM MINERALS Basic Materials 37,630 2,135,472
ALTRI SGPS Industrials 377,840 1,353,400
HORNBACH HOLDING Consumer Services 15,451 1,111,430
GENERAL ELECTRIC Industrials 84,217 980,040
INTERNATIONAL BUSINESS MACHINES CORP. Technology 9,954 973,090
PROCTER & GAMBLE Consumer Goods 22,403 970,926

Top 10 ETF

Name Volume Turnover €
DJ STOXX 600 OPTIMISED BANKS SOURCE ETF 1,501,369 107,595,442
DB X TRACKERS – MSCI EMERGING MARKET TRN INDEX ETF 546,448 16,213,805
ISHARES PLC – ISHARES FTSE 100 2,440,139 15,624,684
DJ STOXX 600 OPTIMISED INDUSTRIAL GOODS & SERVICES SOURCE ETF 109,845 12,058,310
ISHARES MSCI JAPAN FUND 1,422,805 10,250,835
AMUNDI ETF CAC 40 208,945 8,281,748
DB X TRACKERS – MSCI WORLD TRN INDEX ETF 350,000 7,268,580
DB X TRACKERS – DAX ETF 116,458 7,156,578
DJ STOXX 600 OPTIMISED FOOD & BEVERAGE SOURCE ETF 40,900 6,818,372
MSCI WORLD SOURCE ETF 286,000 5,951,000

Top 10 Trades

Name Sector Volume Turnover €
INMARSAT Telecoms 29,340,000 212,753,153
BBVA Financials 15,000,000 147,899,995
RWE Utilities 1,640,000 80,278,001
BANCO SANTANDER Financials 6,228,638 57,428,044
VODAFONE GROUP Telecoms 29,331,172 53,885,029
BP Oil & Gas 10,487,180 51,883,227
TOTAL Oil & Gas 1,200,000 45,359,999
SIEMENS Industrials 494,601 37,243,457
SNAM RETE GAS Oil & Gas 10,000,000 36,799,080
UMICORE Basic Materials 1,000,000 32,519,501

Major Movers

Name Sector Volume Volume (T-1) % Change
INMARSAT Telecoms 46,812,387 874,577 5253%
CABLE & WIRELESS WORLDWIDE Telecoms 18,028,306 829,777 2073%
BANCO SANTANDER Financials 16,225,952 1,393,599 1064%
SNAM RETE GAS Oil & Gas 15,248,043 3,032,024 403%
HSBC Financials 13,907,541 3,314,841 320%
BBVA Financials 406,708,276 111,896,938 263%
LLOYDS Financials 34,690,381 13,755,013 152%
BARCLAYS Financials 13,219,147 5,469,338 142%
BP Oil & Gas 15,059,224 8,540,518 76%
VODAFONE Telecoms 55,079,099 32,405,897 70%

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