30 de abril de 2015 / 14:38 / en 3 años

Weak Treasuries weigh on LatAm credits, primary picks up

NEW YORK, April 30 (IFR) - Latin American credits got off to a weak start on Thursday, as higher US Treasury yields continued to weigh on the asset class amid thin trading volumes.

“It seems like Treasuries are not helping the market again,” said one broker in Miami. “I haven’t seen many trades going through, but prices are wider.”

Another day of weakness across the US Treasury curve - where yields on the 10-year and 30-year benchmarks widened by roughly 6bp to 2.09% and 2.79% respectively - saw traders revise bond prices lower across the region.

Brazil’s benchmark 2025s, for example, were quoted half a point lower in early trading at a cash price of 98.75-99.40 after closing on Wednesday at 99.5-100.0.

“It is the end of the month and I guess everybody has already played their positions,” said the broker, who argued the market will be mostly reacting to moves in Treasuries throughout the session.

In spite of a quiet start in secondary markets, primary activity has picked up pace, with two deals poised to price on Thursday.

The Dominican Republic plans to raise US$1bn though a tap of its 10 and 30-year bonds via Bank of America Merrill Lynch and JP Morgan.

The sovereign is offering investors initial price thoughts of 5.25% area on a reopening of its 5.5% 2025s and 6.65% area on a tap of its 6.85% 2045s.

In the corporate segment, Banco Latino Americano de Comercio Exterior (Bladex), has announced a US$300m five-year senior unsecured bond issue via Bank of America Merrill Lynch and Citigroup.

The borrower, a trade bank headquartered in Panama, was initially approaching investors with price thoughts of low 200s for the issue, which is expected to launch and price on Thursday.


Votorantim Cimentos (Baa3/BBB/BBB) has mandated Citigroup, Deutsche Bank, HSBC, Banco Votorantim, BB Securities, Bank of America Merrill Lynch, MUFG and Santander GBM to arrange a series of investor meetings ahead of a potential euro-denominated bond issue.

The meetings will take place in Frankfurt and Munich on May 4, London on May 5, and Amsterdam and Paris on May 6.

JB y Compania SA de CV (Jose Cuervo) kicked off fixed-income investor meetings this week through Bank of America Merrill Lynch and Citigroup as it seeks to market a possible senior unsecured US dollar bond.

After visiting London on Wednesday, the borrower is in Boston today and will see accounts in Los Angeles on Friday. It will head to Chicago on May 4 and New York on May 5. The spirits company, rated BBB/BBB by S&P and Fitch, is the world’s largest tequila producer.

Pacific Rubiales, the largest private oil producer in Colombia, has kicked off investor meetings through Bank of America Merrill Lynch, Citigroup and HSBC. The company heads to Santiago on Thursday, Los Angeles on May 4 and Miami on May 6.

Reporting by Davide Scigliuzzo; Editing by Paul Kilby

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