EM poised as Treasuries strengthen; Senegal plans dollar, euro notes; LatAm primary quiet

By Rebecca Melvin

New York, Feb. 26 – The emerging markets started the week off on a quieter note on Monday, with spreads wider, but tone healthy as U.S. Treasuries continued to see a bid following selling last week that lifted the yield on the U.S. 10-year Treasury benchmark to nearly 3%. The yield at late morning on Monday was down to 2.84%.

In the Central & Eastern Europe, Middle East and Africa region, spreads on many names including Saudi Arabia were 2 to 3 basis points wider on the day. Some names were wider by a greater amount including Lebanon’s nearer dated issues, which were wider by as much as 38 bps for its 6% notes due 2019. But Jordan’s curve was tighter, according to the data of a London-based trading source.

Meanwhile, the Republic of Senegal announced a new dual-tranche offering of euro- and dollar-denominated notes on Monday.

The African sovereign mandated BNP Paribas, Citigroup, Deutsche Bank, Natixis, Societe Generale CIB and Standard Chartered Bank to arrange roadshow meetings beginning on Wednesday. The emerging markets had a supportive tone late in the Friday session in London, a trader said.

No new issues were announced in Latin America and flows in the secondary market were light, market sources said.

“It was a quiet day,” a New York-based trader said.

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