Pension deficit concern sparks demand for default protection

The largest mover was Rolls-Royce, traders said. The cost of the British company’s five-year credit protection widened nearly 20bp today to 250/270bp. Other names saw increased activity but limited spread movement. “In recent weeks credit default swap prices have been trading tight relative to falling equity prices,” said one trader. “If spreads do start to edge out, this could signal a re-coupling between the equity and credit markets.”

A number of 30-year bond issues in the European

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