EM firms on oil rally but ends mostly mixed; Peru election on market’s mind; Brazil CDS narrow

By Christine Van Dusen

Atlanta, April 8 – Emerging markets were firm on Friday morning as oil rallied, bolstering sentiment for emerging markets assets, but lost some steam as equities reversed gains.

“Ahead of the IMF and World Bank spring meetings next week, the state of the global economy will inevitably shift into focus,” a London-based strategist said.

Also coming up is the OPEC and non-OPEC meeting in Doha, scheduled for April 17, he said.

Against this backdrop, the new issue of notes from South Africa – $1.25 billion 4 7/8% notes due 2026 that priced at 98.631 to yield 5.051%, or Treasuries plus 335 basis points – saw some activity in trading.

Early in the session on Friday, the notes were seen at 98 7/8 bid, 99 1/8 offered, a trader said.

Looking to Latin America, most credit finished unchanged to slightly tighter on Friday after opening very well-bid but fading as the day went on, a New York-based trader said.

Brazil’s five-year credit default swaps spreads closed at 386 bps from 401 bps, while Mexico’s moved to 176 bps from 179 bps.

High-yield names from the region were mixed, with Argentina’s Bonar 2024s unchanged at 108.25 and Venezuela’s 2027s at 37.75 from 37.50 on oil strength.

PDVSA’s 2017s ended the session 53 from 51.25.

Investors were keeping an eye on Peru on Friday, ahead of the sovereign’s election this weekend.

© 2015 Prospect News.
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