1153 GMT - A correction in equity markets could be the trigger for very narrow euro-denominated credit spreads to start widening, LBBW analysts say in a note. Euro-denominated corporate credit spreads recently reached their narrowest in a year as credit investors have largely shrugged off uncertainty over U.S. plans for tariffs and geopolitical tensions. This could soon change, however. "We do not consider this development to be sustainable and expect spreads to widen," LBBW says. Geopolitical and economic risks have only been priced to a limited extent in credit markets. "Spread widening could be triggered by a correction on the equity markets following the brilliant rally." (jessica.fleetham@wsj.com)
(END) Dow Jones Newswires
February 28, 2025 07:04 ET (12:04 GMT)
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