European credit markets sharply wider

European credit markets closed sharply wider in cash bonds and indexes, led by banks and Dubai credits, shrugging off earlier optimism that a tentative resolution on Greek sovereign debt would cut market volatility. European banks underperformed with cash markets matching the derivative format, for once. The heavy supply of senior bank bonds issued in January has generally widened.
Even deals for strong banks such as Credit Suisse are out by 15 basis points from the launch spread of 114 bps over Bunds. By 1730 GMT, the investment-grade Markit iTraxx Europe index was at 90 bps, according to data from Markit, 2.5 bps wider versus late on Thursday, according to data from BGC Partners. The Markit iTraxx Crossover index, made up of 50 mostly "junk"-rated credits, was at 495 basis points, 20 basis points wider.