Morning Commentary: Emerging markets quiet, firm; Kenya spreads widen

By Rebecca Melvin

New York, Sept. 1 – Emerging markets spreads were very quiet but firm on Friday as market activity dwindled ahead of a long holiday weekend in the United States. U.S. financial markets will be closed on Monday in observance of Labor Day.

An exception to the quiet, firm markets was Kenya, where credit spreads widened on average 18 basis points after a court ruled to nullify last month’s presidential elections and hold a new one, a London-based trader said.

The Kenya court upheld an opposition complaint that president Uhuru Kenyatta won the election by fraud and ordered a new election within 60 days. The decision was unprecedented, and Kenya’s stocks swooned, the Kenya shilling weakened and credit spreads were under pressure.

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