Rally continues for EM; Brazil sees selling; Asian trading ‘muted’; Middle East gets buyers

By Christine Van Dusen

Atlanta, Oct. 1 – The rally for emerging markets assets continued on Thursday, though with less strength than seen on Wednesday, with many bonds rising as much as nine points.

“Inquiry is steady,” a trader said. “Seen local Brazil selling in the short end, decent size too. The 2021s and 2024s are seeing the best performance. The 2019s and 2020s are still bringing up the rear.”

Looking to Asia, trading was “fairly muted,” given that Hong Kong was out on holiday and China was beginning its golden week, a trader said.

“Historically this is when housing sales and revenues spike onshore,” he said. “Third quarter and fourth quarter are critical for China property markets, and stellar results should be expected for September and October.”

Flows were balanced for most Asian sovereigns, with the short end of Indonesia and Philippines moving as much as ½ point better, he said.

From the Middle East, buyers were seen for bonds with a five-year and seven-year tenor, a London-based trader said.

The move in oil prices continued having an effect on funding, liquidity and sentiment in the region on Thursday, he said.

In other news, Turkey’s Turkcell Iletisim Hizmetleri AS set the size at $500 million to $1 billion and the tenor at 10 years for its upcoming issue of notes, a market source said.

© 2015 Prospect News.
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