LatAm credits end week well bid, new Mexico bond extends gains
By Davide Scigliuzzo
NEW YORK, April 10 (IFR) - Latin American credits remained well bid Friday, driven primarily by positive sentiment toward Brazilian oil company Petrobras and a healthy crossover bid for high-yielding credits.
"The market is trading pretty strong, especially in the Brazilian context," said one trading desk analyst in New York.
He attributed the positive tone to reports that Petrobras will soon publish audited financial statements and that it plans to sell a large pre-salt exploration area as part of its asset disposal program.
The short end of the Petrobras curve was reaping most of the benefits, ending the day some 10bp-15bp tighter. That compares with a mere 5bp tightening for the belly and the long end of the curve.
Among high-yield credits, Schahin's 2022s were little changed on the day at around 47-48, off its Tuesday's low of 39-41 but still more than 10 points below last week's levels in the low 60s.
A positive tone in the US high-yield market this week was also underpinning demand for some high-yield names across Latin America.
"(This week's rally) has been driven largely by what is going on in Brazil with Petrobras, but the tone in high-yield has also been helpful," said the analyst, who saw good demand for names like Brazilian beef producer JBS, Mexican cement name Cemex and Caribbean telco Digicel.
Among sovereigns, Mexico's new euro-denominated Century bond leaped by at least another point and a half on its second day of trading to end the week at 102.75-103.25, or nearly eight points higher compared to its 95.322 reoffer price. Continuación...