European credit default swaps tightened on Tuesday, tracking higher stocks and supported by hopes that euro zone finance ministers will soon fix details of the region's 750 billion euro ($924 billion) rescue plan. By 0845 GMT, the investment-grade Markit iTraxx Europe index was at 110.5 basis points, according to data from Markit. That is 5 basis points tighter versus late on Monday, according to data from BGC Partners.
The Markit iTraxx Crossover index, made up of 50 mostly "junk"-rated credits, was at 521.5 basis points, 8.5 basis points tighter. Spreads were also supported by a late recovery in US shares, which helped drive stocks higher in Europe. After talks in Brussels, German Finance Minister Wolfgang Schaeuble and others played down what some officials described as Franco-German differences over the way the euro zone anti-contagion mechanism would be deployed if countries needed it.
In single-name credits, Glencore five-year credit default swaps tightened by 7 basis points to 270 basis points, Markit data showed, after the European commodity trader posted solid first-quarter numbers. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose to $1.389 billion, a 92 percent increase from Q1 2009 and a 7 percent rise versus the previous quarter, RBS credit analysts said. Net debt increased slightly to $10.676 billion from $10.186 at December. Vodafone five-year CDS were 2 basis points tighter at 79.25 basis points after the world's second-biggest mobile operator by revenue, posted full-year earnings in line with forecasts. But the company took a hit on its key Indian business.