The new ABX index rollout last Monday might have been the highlight of an otherwise quiet week, but it did not do much to elevate the amount of paper issued. Although $13 billion in deals were in the market last week, just $2.4 billion priced by Thursday.
Unlike the final weeks of June, when many issuers rushed to get their deals out of the door, primary issuance has been persistently light so far in July. Last week, a handful of home equity and auto-loan ABS deals priced, leaving the secondary cash credit market to assert itself. There, said Bank of America analysts, seasoned bonds began trading at less competitive levels than several weeks ago. Traders appeared to be pricing toward worse scenarios, the bank said. Also, the ABX.HE06-2 index began trading on Wednesday, prompting indices in the synthetics market to tick up slightly, according to Bank of America.