LatAm credits end mixed as Argentina, Venezuela diverge
By Davide Scigliuzzo
NEW YORK, March 27 (IFR) - A rally in Venezuelan debt and a sell-off in Argentine bonds made for a mixed trading session in Latin America's credit markets Friday.
Argentine bonds weakened across the board Friday on concerns that a US court might bring more local-law bonds under an injunction that prohibits the sovereign from servicing the debt unless it also makes holdout creditors whole.
"Argentina was very heavy today as people are afraid of the legal risks. Bodens and Bonars were well offered," said a sovereign bond trader in New York. "But Venezuela and PDVSA are better bid."
Local-law Boden 2015s and Bonar 2024s, which are not currently covered by the injunction but are denominated in US dollars, ended half a point lower at 101.0-101.5 and 105.75-106.50 respectively.
"People are a little more nervous," said a second sovereign bond trader in New York.
The performance across Venezuela's curve, where some notes rose by more than a point, was particularly surprising considering that WTI and Brent crude prices respectively dropped by 5.8% and 5.1% today.
Traders attributed the bounce in bonds issued by the oil-rich nation to some short-covering and a rotation out of Argentina into Venezuelan debt.
Venezuela's 2022s, for example, were last quoted at a bid price of 66, or a point and a half higher. Continuación...