Investors grapple with Trump win; oil under pressure; eyes on Mexico; 4finance deal ahead

By Christine Van Dusen

Atlanta, Nov. 14 – Oil prices remained under pressure as Iran boosted production on a Monday that saw emerging markets investors continuing to digest the news of a Donald Trump presidency in the United States.

“While the initial uncertainty caused by a Trump win led to a rally in U.S. Treasuries, the quick shift in focus on his potential fiscal plans has led to a 50-basis points widening in the 10-year,” a London-based analyst said.

Emerging markets assets, meanwhile, suffered during the long weekend and remain “vulnerable to further moves we are seeing in the FX and rates markets,” he said. “Lastly, it remains unclear to us whether the new Trump cabinet will enact meaningful barriers for trade, which might disadvantage many EM sovereigns further. The start of the week therefore heralds little promising so far, with spreads not able to compensate the further widening in underlying rates.”

Investors continued to eye Mexico after the currency and bonds took a beating in the wake of Trump’s win.

“According to the Trump’s economic advisor, trade agreements may be improved,” Schildershoven said. “Mexico’s national currency stabilized as Trump’s economic advisor Anthony Scaramucci commented that new administration may be less anti-trade than investors originally expected.”

Latvia’s 4finance Holding SA will hold a roadshow for a possible tap of its euro-denominated 11¼% notes due May 23, 2021, according to a company announcement.

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