NEW YORK, Nov 10 (IFR) - Higher oil prices and bargain hunters were providing some support to LatAm debt markets on Tuesday as investors squared positions ahead of the US Veterans Day holiday on Wednesday.
“We have been weak since Friday’s payroll number, but things are stabilizing,” said a New York based trader.
Commodity producers were recovering a touch as bonds issued by Brazilian miner Samarco came off recent lows.
Samarco’s bonds were being spotted at 62.375 after falling to around 55 cents on the dollar on Monday.
Mining giant Vale, which jointly owns Samarco with BHP Billiton, saw its bonds tighten 3-5bp earlier today, with the 2022s being quoted at 393bp-383bp.
Elsewhere in Brazil, bond prices were still under pressure though some accounts were showing interest at current levels.
“We are seeing mixed flows,” said Klaus Spielkamp, head of fixed-income sales at Bulltick. “Prices are lower but we have seen some buyers.”
Reports that former central bank head Henrique Meirelles might step in to replace Joaquim Levy have somewhat mitigated concerns about the departure of the orthodox finance minister.
However, the sovereign’s 2025s are still lumbering around 87.50, marking a good three point drop since early November.
Meanwhile, the region’s primary markets are struggling to gain momentum following Chilean financial firm Tanner’s decision this week to postpone a US$300m five-year bond until next year.
The only bond offering on the immediate horizon is now a US$200m-US$500m five-year bond from Argentine mortgage bank Banco Hipotecario, which is looking to fund a tender following the second round of the presidential election on November 22.
A victory for market favorite candidate Mauricio Macri could encourage the bank to tap soon after the election - its first foreign foray since 2007.
Secondary prices for recently minted deals have been holding up, though performance has been far from stellar.
The new seven-year bond issued by Mexican REIT Terrafina is trading at 99.25-99.75, or flat to reoffer of 99.486.
It is a similar story for the five-year bond issued by Mexican development bank Nafin, which has been trading around 99.50-100.00 versus a reoffer of 99.822.
Mexican white-goods manufacturer Controladora Mabe has finished investor meetings through Barclays, Bank of America Merrill Lynch, Citigroup and JP Morgan. Ratings are BB+/BB+.
Mexican REIT Fibra Uno completed meetings with investors through Bank of America, Credit Suisse, HSBC and Santander. Brazilian airline GOL Linhas Aereas Inteligentes (B3/B-/B-) completed roadshows with Morgan Stanley, Credit Suisse and Citigroup. (Reporting By Paul Kilby; editing by Shankar Ramakrishnan)