As the session progresses, credit markets are experiencing a notable shift in sentiment. The CDX index is currently wide, decompressing, with High Yield down 20 cents and Investment Grade 0.45bp wider. This sudden change in market dynamics raises questions about the potential for a broader credit deterioration.

Flows have been skewed towards better seller risk throughout the day, with the imbalance finally catching up in the credit markets. The Russell 2000 is also exhibiting heavy trading activity, suggesting that investors are becoming increasingly cautious about the prospects of a near-term Iran deal.

While the exact cause of this shift in sentiment is unclear, it is worth noting that recent events have had a profound impact on global markets. The ongoing COVID-19 pandemic has disrupted supply chains and economic activity worldwide, while political tensions between the US and Iran have raised concerns about potential conflicts in the region.

In light of these developments, it is crucial to keep a closer eye on credit markets in the coming days. As investors continue to grapple with the fallout from these events, market dynamics could continue to shift in unexpected ways. Staying informed and adaptable will be key to navigating these challenges successfully.