In the wake of the devastation wrought by Hurricane Katrina, the question on most people's minds in the ABS market is how deals in some of the non-mortgage related ABS sectors will respond, and how badly the damage will affect deals in those sectors. Luckily, unlike in the Gulf coast region itself, it appears as if the ABS market will weather the storm.
In general, ABS researchers, such as those at JPMorgan Securities seem optimistic about the potential negative affects of the disaster on ABS deals. "In the overall ABS market, we believe the effects should be limited, given the small percentages of pools represented by the disaster areas," JPMorgan analysts wrote. One of the sectors that has the most exposure to the affected areas is the manufactured housing sector, the other, mostly through higher fuel prices, is autos.