LatAm credits endure volatile session
By Davide Scigliuzzo
NEW YORK, April 9 (IFR) - Latin American credits experienced a volatile session on Thursday, as currency weakness in many of the region's markets put a damper on the morning's strong performance.
"We opened strong following headlines that Petrobras was going to publish financial statements (before April 20), but then the Mexican peso blew up," said a corporate bond trader in New York.
The Mexican peso weakened by 1.2% falling back to 15 against the dollar during the session, while other LatAm currencies such as the Brazilian Real and the Chilean peso were also ending weaker.
Several investment-grade corporate bonds came off their intra-day highs as a result but were still ending the day stronger, with Brazilian banks and Eletrobras seen outperforming. The latter's 2019s, for example, closed up three points at 98.00-98.75.
Bonds of high-yield corporates also suffered price swings, but were mostly ending unchanged, according to a second New York-based trader.
"Cemex was pretty active, but I think people are still looking to get a sense of direction," said the trader, who had the company's 2025s last quoted at 102.125-102.500, or unchanged on the day.
In the Brazilian sugar and ethanol space, meanwhile, a 2020 note issued by Tonon dropped by 2.75 points to a low of around 26 before finding some buyers, said the trader.
Among sovereigns, however, it was Mexico's new EUR1.5bn century bond that captivated market participants. Continuación...