Carson Block, a short-seller who leads Muddy Waters, said at a recent conference that he'd purchased credit default swaps protecting against losses on Standard Chartered's debt. Block's move has prompted an increase in CDS on the British bank. "They are not saying short Standard Chartered, it's going to zero -- it's more nuanced," said Cormac Leech, an analyst at Liberum Capital. "They're saying CDS spreads are low and they are buying."

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