EM trades quietly into month-end; eyes still on Fed chair choice; CAF prices notes

By Rebecca Melvin

New York, Oct. 31 – Emerging markets traded quietly into month end after early strength on Tuesday as market participants eyed a raft of potentially market moving news later in the week, in particular President Donald Trump’s pick for next Fed Chair expected on Thursday, market sources said.

Headlines about U.S. Special Counsel Robert Mueller’s indictments in the investigation into Russian interference in last year’s U.S. presidential elections were also garnering attention as well as the start of the Federal Open Market Committee meeting on Tuesday.

U.S. Treasuries were choppy contributing to the quieter tone, a trader said. But the yield on the benchmark 10-year Treasury note closed at 2.374%, unchanged from Monday.

Investors were returning to the Turkish bank space after selling last week on talk of potential U.S. sanctions against Turkey. Spreads retightened – although remained wider than they had been – after comments from U.S. Treasury Secretary Steven Mnuchin who said that he had not talked with Turkish government officials about potential sanctions.

Mnuchin wrapped up a Middle East trip in Qatar on Monday, where he said that both countries have a “share understanding” in fighting terror. He also praised the “robust ties” between the United States and Qatar, MUFG Securities strategist Trieu Pham wrote in a note on Tuesday.

Arab Petroleum Investments Corp.’s 3.141% Islamic bond, which priced last week, were seen in trade at 100¼ bid, 100 3/8 offered, which was up from 100.13 bid, 100.18 offered on Thursday after the multilateral development bank priced $500 million of the five-year notes under Regulation S.

In primary market activity, Latin America regional lender Corporacion Andina de Fomento (CAF) priced $1 billion of 2¾% notes due 2023 at mid-swaps plus 70 basis points.

According to a filing, the five-year bullet notes priced at 99.773.

The Securities and Exchange Commission-registered CAF notes are non-callable, and proceeds will be used to repay $1 billion floating-rate notes due 2018.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.