US bond markets were closed for Veteran's Day, leaving the way clear for UK pay-TV companies to dominate the agenda.

News over the weekend that BSkyB had lost out to rival BT for rights to show European Champions League football sent shockwaves through the equities market. BSkyB's stock fell by more than 10% in reaction to its failure to keep hold of the Champions League package.

Credit markets, though, were far more sanguine on the weekend's developments. BSkyB's spreads widened by just 2bps to 56bps, and remain close to their tightest levels for the year. The firm trades with an implied rating of 'A', which is superior to its BBB rating from the agencies, according to Markit data.

The movement in BT's spreads was also modest, with widening of just 2bps to 64bps. BSkyB declared that BT had overpaid for the rights, but the credit market reaction suggests investors don't see this as a problem.

The impact on subscriptions for BSkyB may not be as meaningful as many predict. In continental Europe, TV firms Premiere and Canal+ lost a relatively small amount of customers after they failed to retain football rights.

However, few would dispute the importance of the UK Premiere League football to BSkyB's future, and it is here where the real battle will lie. The Premiership is the jewel in the crown of Sky's content - it will surely fight had to retain the rights in the next auction in 2015.

BT's entry into the market, though, will inevitably lead to rights inflation and higher marketing costs, and this could impinge on Sky's bottom line in the coming years.

TV drama aside, the markets were relatively calm due to the Veteran's Day holiday. The Markit iTraxx Europe was 1bp tighter at 83bps, helped by solid Chinese economic data released over the weekend.

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