One of the big beneficiaries of the eurozone rescue package set out last week was the credit default swap index linked to European senior unsecured bank debt, which tightened dramatically on Thursday as sentiment improved on the prospect of a bank debt guarantee.

The Markit iTraxx Europe Senior Financials index, which tracks credit default swaps on the senior unsecured debt of 25 leading European banks and insurers, ended on 207 basis points, 35 basis points tighter than the close on Wednesday, according to Markit. That is the lowest closing level since August 4, and the biggest one day move this year.