European credit spreads were slightly wider on Thursday, while new issuance showed signs of moderating in the primary market. By 1529 GMT, the investment-grade Markit iTraxx Europe index was at 121.94 basis points, according to data from Markit, 0.94 basis points wider versus late on Wednesday. The Markit iTraxx Crossover index, made up of 45 mostly "junk"-rated credits, was at 755 basis points, 10 basis points wider.
The US economy shrank slightly less in early 2009 than previously thought, but demand was still soft. "Macro data and commentary from companies indicate that the economy may be bottoming," Barclays Capital said in its Global Outlook. Five-year CDS on Ahold tightened to around 95 basis points, about 8 basis points tighter, Markit data showed.
This followed a credit rating upgrade on Wednesday by Standard & Poor's which cited the Dutch retailer's strong first quarter earnings. British broadcaster ITV had around a 50 percent take-up of its bond exchange, giving the group more breathing space to repay debts. Five-year credit default swaps on ITV were about 10 basis points tighter at 465 basis points before the exchange results and no further reaction after they were announced.