|
PureBytes Links
Trading Reference Links
|
911 has hurt Argentina/Brazil as emphasis moves
to stabelizing U.S. markets vs
their concerns....
<FONT face=Quotrone
size=2>----------------------------------------------------------------------------------
10/05 11:22A (RT) Emerging Debt-Argentina yanks
market lower for fifth day
Story 2553 (I/US, I/EMRG, I/DBT, I/LDC, I/AR, I/BR, I/MX, I/GVD,
I/LATAM...) By
Genevieve
Wilkinson
NEW YORK, Oct 5 (Reuters) - Emerging market bonds sank
for
the fifth day in a row on Friday as investors
doubted
Argentina's political capacity to cut spending to meet its
zero
deficit obligation, the linchpin for multilateral
funding.
Jim Carlen, emerging market portfolio manager at
American
Express, said Argentina should be able to service its
$132
billion debt load in the short term as long as the level
of
bank deposits remains
stable.
But the dismal September tax receipts -- down 14
percent
from the same month in 2000 -- calls into question
Argentina's
ability to meet its zero deficit target, to which
multilateral
loans are tied ahead of congressional elections on Oct. 14,
he
said.
"It's hard to know what saves Argentina at this
point,"
Carlen said.
The J.P. Morgan Emerging Markets Bond Index Plus widened
14
basis points to 1,086 basis points over U.S.
Treasuries.
Argentina's portion of the index widened 59 basis points
to
1,924 basis points over
Treasuries.
Argentina's FRB dropped 0.500 points to 62.000
and the
2031
global bond sank 0.875 point to 43.750. But the 2008
bond
firmed 0.125 point to
52.125.
New York trading of emerging market debt is scheduled
to
close early at 2 p.m. EDT(1800 GMT) and reopen on Tuesday
after
the Columbus Day holiday in the United
States.
"There are a lot of questions about whether there
would be
announcements over the weekend -- which we have seen many
times
before -- so people are wondering if that will happen and
what
that could be. There's talk of dollarization, and of a
debt
exchange, but nothing concrete," said David Sekiguchi,
emerging
market strategist at Deutsche
Bank.
Downplaying previous comments that suggested
Argentina
would sooner dollarize than devalue its currency, Cabinet
Chief
Chrystian Colombo said on Friday Argentina is not
considering
replacing its peso with the U.S.
dollar.
"This speaks to the confusion in the directional policy
in
Argentina," said Christian Stracke, chief Latin American
debt
strategist at Commerzbank
Securities.
One dealer said he was going into the long weekend flat
to
short, meaning he was placing some bets that the market wouldmove lower
in the immediate
term.
Funds, not dealers, have been the dominant sellers
of
emerging market debt this week. The EMBI-plus has widened
80
basis points since last Friday's
close.
Nine days ahead of congressional elections that
could
change the approach Argentina takes to its protracted
recession
and burdensome debt load, analysts say Latin
America's
third-biggest economy is close to the
precipice.
At a time when cash-strapped Argentina cannot raise
money
on the international capital markets, tax receipts are
falling,
consumer confidence is near historic lows and
industrial
production and construction activity are
plunging.
UBS Warburg was advising its clients remain
defensively
positioned in Latin American bonds by moving closer to
the
benchmark index and reducing duration exposure, shifting
from
risky to safer credits or buying underperforming
low-priced
bonds.
Brazilian bond prices got caught up in the
negative
sentiment swirling around Argentina as dealers sell the
liquid
Brazilian bonds in an effort to hedge their Argentine
exposure.
Brazil's portion of the EMBI-plus widened 19 basis
point
to 1,257 basis points over U.S. Treasuries.
Brazil's C bond
--
the market's benchmark bond -- traded flat at
64.750.
The contagion did not spread throughout the
market.
Colombian bonds spreads tightened three basis points to
632
basis points over Treasuries and Mexican bond spreads were
flat
at 441 basis points over
Treasuries.
((Emerging Markets Desk 646 223
6319))
REUTERS
Rtr 11:22
10-05-01
Additional Codes ( I/PA, I/PE, I/CO, I/EC,
M/EMRGDBT)
Yahoo! Groups Sponsor
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxxxxxx
Your use of Yahoo! Groups is subject to the Yahoo! Terms of Service.
|