Lower commodities, equities leave Asia mixed, Lat-Am wider; Peru to issue dollar bonds

By Christine Van Dusen

Atlanta, Aug. 18 – Cash prices for Latin American bonds bounced around on Tuesday, while Malaysia firmed up and Korea was broadly unchanged against a backdrop of lower commodities, lower rates, weaker currencies, a stronger dollar and lower Asian equities.

“It’s a continuation of trends,” a London-based trader said. “Most market commentators are not willing to pick a bottom on oil, as they fail to see a positive story on the demand or supply side.”

Asian bonds started off a bit firmer but took a hit as Chinese equities continued to fall, another trader said.

“Investment-grade cash bonds closed the day unchanged,” he said. “Lower oil had very little impact on oil names, with Cnooc Ltd.’s 2025 trading up at 180 basis points, tighter by 2 bps.”

“Thailand spreads remained firm after the bombing in Bangkok,” he said.

Going into the London close, the tone for Asian bonds was mixed, with Indonesia and Pakistan trading within a narrow range, another trader said.

“China investment grade was probably 1 bp to 3 bps wider,” he said. “The Bangkok bombing incident didn’t really impact the market.”

From Latin America, low-beta spreads finished the day wider, with Brazil’s five-year credit default swaps spreads closing at 312 bps from 306 bps. Mexico’s ended the session at 142 bps from 138 bps.

In deal-related news, Peru is planning to issue dollar-denominated notes due in 12 years with bookrunners Citigroup and JPMorgan, a market source said.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.