The Deutsche Bank headquarters are seen in Frankfurt, Germany October 29, 2015. REUTERS/Kai Pfaffenbach

A note on Bloomberg drew attention this morning to the latest negative price action in European Contingent Convertible bonds. It may be a canary in Europe’s credit market, and a litmus test of current European risk appetite:

“CoCos have already seen some sharp price falls this month in what could be a warning sign of a more broad-based decline in risk appetite over the coming months; the moves may mark a potential first sign of increasing investor caution and fading risk appetite

Low seasonal liquidity and rising geopolitical tensions may account for a more cautious investment bias in lower echelons of the credit spectrum

* Barclays 5.875% AT1 deal launched at par on Aug. 3 was quoted at GBP98.74 bid as of 10.35am London time today, according to CBBT data on Bloomberg

** Barclays 7.25% AT1 meanwhile has fallen from a high of GBP109.45 on Aug. 4 to GBP107.07 currently

** Deutsche Bank 6% AT1 has seen similar magnitude price moves; was quoted as high as EU103.09 on Aug. 2 and is now quoted at EU100.82″