LATAM WRAP-LatAm credits take back losses in rare rally

jueves 27 de agosto de 2015 14:21 GYT

By Paul Kilby

NEW YORK, Aug 27 (IFR) - Reduced expectations for a Fed lift-off in September and a sharp bounce in commodities had LatAm credits enjoying a rare rally on Thursday.

Debt issued by oil-rich Venezuela jumped as crude enjoyed an unusual 9% rally today. The sovereign's 2022s were up almost three points at 43.75.

Brazilian debt was also putting in a strong performance after suffering a rout earlier this week on Chinese growth concerns.

The 2022s issued by country's state-owned oil company Petrobras were trading back at 607bp, marking a 70bp tightening since Monday.

The sovereign's benchmark 2025s were also up about two points at 93.25-94.00, or at a spread of around 305bp, some 35bp tighter on the week.

Longer term there is still some uncertainty surrounding emerging market debt which is expected to keep the new issue market quiet.

On the one hand, investors seem relieved that Chinese authorities had stemmed the sell off in their stock markets but on the other, no one is really certain about the direction these markets would take.

"Governments are not going to stay quiet in front of this (selloff) and that is providing some comfort to investors," said Jorge Piedrahita, CEO of broker Torino Capital.   Continuación...