The cost of insuring company and sovereign bonds against non-payment in the Asia-Pacific region rose, according to traders of credit-default swaps.
The Markit iTraxx Australia index jumped 2 basis points to 122 as of 10:34 a.m. in Sydney, according to Westpac Banking Corp. (WBC) prices. The measure is poised for its third weekly rise, according to data provider CMA.
The Markit iTraxx Asia index of 40 investment-grade borrowers outside Japan added 2 basis points to 153 basis points as of 8:23 a.m. in Hong Kong, Australia & New Zealand Banking Group Ltd. (ANZ) prices show. The benchmark is set for its second straight week of increases, according to CMA, which is owned by McGraw-Hill Cos. and compiles prices quoted by dealers in the private market.
The Markit iTraxx Japan index added 1.5 basis points to 93.75 basis points as of 9:42 a.m. in Tokyo, according to Citigroup Inc. prices. The gauge is set for its biggest daily gain since Sept. 30, CMA data show.
Credit-default swap indexes are benchmarks for insuring bonds against default and traders use them to speculate on credit quality. A drop signals improving perceptions of creditworthiness, while an increase suggests the opposite.
The swap contracts pay the buyer face value in exchange for the underlying securities if a borrower fails to meet its debt agreements.
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