With MF and JEF hogging all the financial institution airtime, MS (and BAC and Citi) are deteriorating and heading back to end of September levels (which may be too high). In September, the slide in MS was blamed by many on CDS. I am not sure that one leads the other, they are co-incident, but in any case they are heading towards their worst levels of the year.
BAC seems destined to trade with a 4 handle (so much for installing a bathtub in the office to get more inspired investment ideas).
MS, BAC, and Citi all relied heavily on their DVA gains last quarter, they won’t get that benefit this quarter (so far at least).