EM market finds its pulse
* Brazil leads the charge
* Corporate supply boosted
* More to come but risks remain
By Sudip Roy
LONDON, March 11 (IFR) - The EM bond market exploded back to life this week as issuers from across the board jumped in to take advantage of the better market tone, with the prospect of more big deals to come soon.
After a tepid first two months, the primary market turned 180 degrees as new issues came thick and fast.
Twelve borrowers across the globe printed deals, raising US$13.44bn as EM caught up with other markets to exploit the best issuance window in several months. While fundamentals remain weak, as reflected by a series of downgrades and negative ratings actions in recent weeks, the technical picture has improved.
"EM local market returns in US dollars are up and leading the rebound year-to-date, while fund flows continue to suggest there is appetite for EM risk," said Murat Ulgen, global head of emerging markets research at HSBC in a report.
It's anyone's guess how long this appetite for risk will last, but while it does EM issuers are exploring all corners of the funding markets - dollars, euros, high grade, high yield, and sub debt. Continuación...