Morgan Stanley and Goldman Sachs Group Inc. led a drop in the cost of default protection on corporate bonds as a plan by U.S. lawmakers to shore up financial company balance sheets eased turmoil in credit markets.
A benchmark gauge of credit risk in North America plunged to the lowest since Sept. 12, before Lehman Brothers Holdings Inc. was forced to file for bankruptcy protection amid a crisis of confidence for Wall Street firms. Contracts on Morgan Stanley and Goldman Sachs, which soared this week as traders sought to hedge themselves against more failures, plunged the most ever.
