LATAM WRAP-Brazil prices swing on talk of Levy departure
By Paul Kilby
NEW YORK, Nov 13 (IFR) - Petrobras's poor third-quarter results, weaker oil prices and reports that the Brazilian finance minister may step down sent the country's bonds on another rollercoaster ride on Friday.
Petrobras bonds were off the intra-day low Friday afternoon but still as much as 1.5 points down on the day after the state-owned oil company posted a R$3.76bn loss in the third quarter.
A weaker exchange rate, lower oil prices and an ongoing corruption investigation have complicated management's efforts to turn the company around.
Its 2024s were down about 1.5 points at 78.25-79.25.
"We have seen selling from retail investors and real money, but the Street has no incentive to take on Petrobras risk at this time of the year," said a New York-based trader.
Price swings in Brazil's debt markets have been exacerbated by local news reports that President Dilma Rousseff has decided to replace Finance Minister Joaquim Levy.
Brazil's sovereign curve recovered some earlier losses but was about 1/2 to 3/4 point weaker on the day, with the 2025s quoted at around 87.35-88.10.
It is a similar story on the corporate side, with investors focusing on Petrobras's poor numbers and troubles in the commodities sector, where crude prices extended losses again. Continuación...