The oil sector took centre stage in an otherwise quiet start to what promises to be a very busy week on both sides of the Atlantic.

Oil rig operator Transocean was one of the more active names following news that Carl Icahn has built a 5.6% stake in the firm and is pushing for a dividend of at least $4 a share.

Icahn is an investor renowned for pressuring corporate management into taking shareholder-friendly actions, and his presence is negative for Transocean's credit profile. If Icahn get his way, the dividend payment will amount to about $1.5 billion and will make a significant dent in Transocean's cash reserves.

The company recently agreed to pay $1.4 billion to settle charges made by the US Department of Justice relating to its role in the Deepwater Horizon disaster in 2010. Moreover, the firm could face further damages in the coming year.

A large dividend payment would reduce the firm's financial flexibility and make it more difficult for it to retain its investment grade rating - a stated aim of the company's management.

Transocean's CDS spreads widened 15bps to 165bps, making it the worst performer in the Markit CDX.NA.IG. Nonetheless, the company's spreads are still about 400bps tighter than the levels reached when the Deepwater Horizon crisis was at its most intense in 2010.

Future spread direction will partly depend on whether Icahn is successful in his aims, and the likelihood of additional shareholder-friendly activity in the future.

Looking ahead, there are plenty of macro data and corporate results for the markets to get their teeth into. On Wednesday we will have the latest policy decision from the US Federal Reserve, and initial fourth-quarter GDP estimates for the US and Spain.

Later in the week we have Markit PMIs and the all-important US non-farm payrolls report. On the corporate front it will be the busiest week of the current earnings season, with Europe making a big contribution for the first time. Several major banks are scheduled to report, as well as the large oil and pharmaceutical companies.

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