In London, the Markit iTraxx Europe Index of 125 companies with investment-grade ratings added 5.8 to 149.4. In the Asia- Pacific region, the Markit iTraxx Japan index rose 1 to 177 as of 9:36 a.m. in Tokyo, Citigroup Inc. prices show.

Loan Prices Rise

The indexes typically rise as investor confidence deteriorates and fall as it improves. Credit-default swaps pay the buyer face value if a borrower fails to meet its obligations, less the value of the defaulted debt. A basis point equals $1,000 annually on a contract protecting $10 million of debt.

The New York Fed invited eight broker-dealers to compete for the so-called MAX CDOs after receiving "several" unsolicited bids for the holdings in its Maiden Lane III LLC portfolio, according to an April 10 statement. The other banks invited to bid are Barclays Plc, Deutsche Bank AG, Bank of America, Morgan Stanley and Nomura Holdings Inc.

The collateralized debt obligations, composed of two CDOs issued by Deutsche Bank in 2007 and 2008, could be sold intact or broken into pieces, though an interest-rate swap contract with Barclays would need to be paid out to access the underlying bonds, eating into profits, JPMorgan analysts said in a report last week. The consortium of the three banks is not looking to break up the deals, people with knowledge of the auction said.

Leverage Loans

The Standard & Poor's/LSTA U.S. Leveraged Loan 100 index rose 0.02 cent to 93.54 cents on the dollar, the highest since April 6. The measure, which tracks the 100 largest dollar- denominated first-lien leveraged loans, has returned 4.6 percent this year.

Leveraged loans and high-yield bonds are rated below Baa3 by Moody's and lower than BBB- by S&P.

The Carlyle Global Market Strategies 2012-2 CLO may include a $320.75 million slice rated AAA by S&P, two people with knowledge of the transaction said. Wells Fargo & Co. and Mitsubishi UFJ Financial Group Inc. raised a $509.9 million CLO for Carlyle last month, the third largest CLO, backed by widely syndicated loans, raised this year, Bloomberg compiled data show.

CLOs are a type of collateralized debt obligation that pool high-yield, high-risk loans and slice them into securities of varying risk and return.

In emerging markets, relative yields rose 4 basis points to 358 basis points, or 3.58 percentage points, according to JPMorgan's EMBI Global index. The measure has averaged 373 basis points this year.

Slower Junk Returns