Confidence in the loans used to back companies with high-risk ratings rose to the highest level for two months following a dramatic drop in mid-July, according to several indices tracking credit performance in the US and Europe.

The US-based LCDX, a gauge of confidence in loans of 100 companies, rose to a price of $97.73 after falling to its lowest value in July, while the benchmark iTraxx LevX Index of credit-default swaps on European loans also climbed to its highest in two months.