LatAm ‘heavy’ as stocks, Treasuries drop; Akbank launches deal; Venezuela little changed

By Rebecca Melvin

New York, Feb. 20 – Latin America’s debt markets were heavy on Tuesday as the holiday-shortened week in the United States got underway amid a drop in U.S. stocks and Treasuries.

The long end in Brazil was down 1½ points, and Argentina’s long bond was down 1¼ points on Tuesday, according to a market source. But Costa Rica was resilient, with the Costa Rica 2045 bonds holding in and sporting a spread that stands 15 basis points tighter since Feb. 5, when the curve fell on an unexpected victory by religious fundamentalist candidate Fabricio Alvarado.

For the region overall, Latin America closed lower on Tuesday because of the move in rates that was largely influenced by a Treasuries auction, a New York-based market source said.

Elsewhere in emerging markets on Tuesday, Akbank TAS announced and launched $400 million of 10-year notes (expected ratings: B1//BB).

While emerging markets has been susceptible to spikes in Treasuries that have transpired of late, one market that continues to move unto its own is that of Venezuela and Petroleos de Venezuela SA. There have been no new developments in the Venezuela and PDVSA market in recent sessions, but investors remain braced for a potential default at any time.

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