Primary hosts Argentina, Halkbank; EM pauses, then finishes mixed; ‘rollercoaster so far’

By Christine Van Dusen

Atlanta, June 30 – Argentina and Turkey’s Turkiye Halk Bankasi (Halkbank) sold notes on Thursday as emerging markets assets at first took a breather and then finished the session mixed, in many cases unable to keep up the previous day’s momentum.

“After yesterday’s rip, the market looks to be taking a pause on the open today,” a London-based trader said. “Turkey and [Middle East and North Africa] cash prices are a touch softer, and spreads a few basis points wider. Can’t say I’m surprised, given the stellar run the market has had since last Friday’s open.”

Performance for most emerging markets assets was “a mixed bag,” driven by weaker currencies, a London-based analyst said.

Investors went into the Brexit vote light on risk, he said, “so we have seen a bit of a perfect storm into today’s month-end,” he said. “Supply and demand is, as always, the biggest driver in the market.”

Looking to Latin America, some bonds were slightly lower at the open on Thursday but improved as the session went on, a New York-based trader said.

Emerging markets credit, overall, continues to trade at rich levels, the analyst said, even as uncertainty about the global outlook has increased since the United Kingdom’s vote to leave the European Union.

Said a trader, “The first half of 2016 is done, and it’s been a rollercoaster so far. The summer lull is on the horizon, so watch for another liquidity trap.”

© 2015 Prospect News.
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