EM starts off quiet, then picks up; Argentina issue in focus; Chexim active in secondary

By Christine Van Dusen

Atlanta, April 20 – Emerging markets bonds were unusually quiet on Wednesday morning, with spreads widening, before gathering steam amid heavy demand for the new issue of notes from Argentina.

“After a rip-roaring session in EM yesterday it’s not surprising we see a pause this morning,” a trader said.

The focus, in the secondary market, was mostly on Argentina’s gigantic $16.5 billion issue of notes due in three, five, 10 and 30 years, which priced on Tuesday.

“But all seems well in the corporate universe; the water is definitely still warm,” a New York-based trader said. “Dealer support remains strong on most [high-grade and high-yield] issues as the strong client buying has waned over the past week.”

Brazil-based Vale SA managed to hold in well, and Colombia-based Ecopetrol SA’s weakness from Friday and Monday was “erased,” he said. “Mexican high-grade and Cemex SAB de CV were also quiet but firm.”

Bonds from Turkey were slightly weaker on Wednesday morning, with spreads pushing out between 2 bps and 4 bps, a London-based trader said.

In other trading, bonds from Qatar were well-bid, as were those from Bahrain, a trader said.

Export-Import Bank of China’s (Chexim) new three-tranche issue of $2.25 billion notes due April 26, 2021 and 2026 and €650 million notes due April 26, 2019 saw some activity in trading, a market source said.

© 2015 Prospect News.
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