EM debt tighter in light, post-holiday volume; primary quiet; Ghana bonds improve 10 bps

By Paul Harris and Rebecca Melvin

New York, July 5 – Emerging markets debt was tighter on Thursday but with cash bonds trading on very little volume and without an obvious catalyst for strength, following Wednesday’s Independence Day holiday in the United States when financial markets there were closed, a New York-based market source said.

Most of the views being expressed on Thursday were through credit default swaps, with a strong rally across names and low-beta credits leading the charges, the source said.

Mexico’s five-year CDS spread was at 115.25 basis points on Thursday as that country’s credit and currency were stable to tighter following the election on Sunday.

New issue activity, already in a summer lull, was also sidelined by the 2018 World Cup international football tournament, now underway and vying for the attention of market participants around the globe, a trader remarked.

Primary market activity was quieted from Asia to Latin America. Concerns over the trade dispute between the United States and China have weighed on sentiment in both markets, but on Thursday Asia remained under pressure while the U.S. markets seemed to shake off fears.

Republic of Ghana’s global bonds, which came in a $2 billion two-part issue in mid-May, were 10 bps tighter with the market on Thursday, according to a London-based bond trader.

© 2015 Prospect News.
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