Petrobras, Vale underperform in quiet market
By Davide Scigliuzzo
NEW YORK, April 28 (IFR) - Brazilian corporates including Petrobras and Vale extended losses on Tuesday, as investors sought to lock in profits after the recent rally in Latin American credits.
"As far as we understand, people are just hitting bids and getting out of stuff that had rallied a lot," said a corporate bond trader in New York.
Bonds of state-run oil company Petrobras were ending some 16bp-17bp wider, with the 2024s and 2044s quoted at spreads of 424bp-419bp and 460bp-455bp respectively, the trader said.
The curve of miner Vale was also underperforming after a strong rally recently, with the 2036s closing some 20bp wider at 405bp-399bp and the 2022s last quoted at 272bp-266bp.
"After being on fire, (Vale) finally came off," said the trader. "I think it was way too tight and had rallied too fast with iron ore. Finally some supply came."
Sovereign credits generally held steady in price and were closing tighter in spreads, given the widening of US Treasuries. The 10-year was quoted at 1.98%, or 6bp wider on the day.
"Sovereigns are holding in okay today, with low-beta (credits) outperforming the move in Treasuries," said a sovereign bond trader in New York.
Venezuela appeared to cement earlier losses, with its 2022s poised to end the session more than a point lower at around 53.5 mid-market. Continuación...