Credit indices

The Credit Default Swap indices have been improving this. Even with today's sell off, these indices appear to be heading south -- which should be supportive of equities.

Here's the US Investment Grade Index (from Credit Derivatives Research). By the looks of it, this index put in a lower high -- a lower low would be bullish

CDR's US High Yield index is on the right, a head
and shoulder's formation.

CDR's Europe Investment Grade Index is on the left. Another head and shoulder's formation.







CDR's Europe Crossover (mostly high yield) is on
the right. This is the worst performing index --
it has not yet clearly turned over, a new high would be bearish for equities.




In spite of today's sell off in equities, all four of these indices have signs of improvement.

Markit's ABX and CMBX's indices were also showing signs of improvement, but today they paused. Here's Markit's CMBX-NA-AAA 4 index , it bounced off of the previous lows.