A thaw in U.S. budget negotiations to avert the "fiscal cliff" has lowered the Markit CDX North American Investment Grade Index, a credit default swaps benchmark. A deal appears likely, and the wider significance is that it would mark "sort of a down payment on finally some fiscal reform," DoubleLine Capital CEO Jeffrey Gundlach said. On the risk front, an ISDA panel characterized the Chapter 11 filing of Edison Mission Energy, an unregulated generating unit of Edison International, as a credit event.

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