South America

South American sovereign Uruguay is meeting international investors ahead of a planned Uruguayan peso-denominated fixed rate bond issue.

Goldman Sachs sparked the ire of Venezuelan opposition supporters and several bond investors this week as it bought $2.8bn of PDVSA bonds at a hefty discount that put the yield at 40%.

Moody’s followed Standard & Poor’s in placing Brazil’s credit rating on negative outlook on Friday, but both agencies have reaffirmed Petrobras’ rating as analysts say they expect the state-owned oil company to gain ground on its sovereign parent.

The Province of Buenos Aires gave a taste of the possibilities available in Argentina’s domestic market on Tuesday with an innovative peso bond targeted at international investors that left the province’s undersecretary of finance more than satisfied.

LatAm bond market participants said contagion from the latest Brazilian corruption crisis had dissipated this week as new issuance returned to the region and spreads recovered within and outside Brazil.

The Province of Buenos Aires showed the resilience of demand for Argentina as it sold a $950m equivalent peso denominated bond mainly to international buyers the day after the currency hit its all-time weakest level against the US dollar.

Candy manufacturer Arcor is planning to tap its dollar-denominated 2023s for up to a further $150m in a deal that would likely sweeten the liquidity in the existing bonds.

S&P became the first ratings agency to react to the latest corruption scandal in Brazil on Monday, but some large investors already think the market has overreacted to the news.

The Province of Buenos Aires could proceed with its planned peso-denominated bond as soon as Tuesday, according to an investor in Buenos Aires.

Market volatility has led the Province of Buenos Aires to pause ahead of a planned $500m-equivalent peso-denominated bond issue, but it will continue to monitor market conditions.

Brazil and Trump-related turbulence left the Province of Buenos Aires waiting ahead of a planned peso-denominated bond, though bankers say Argentine issuance should resume shortly.

Corruption accusations made overnight on Wednesday against Brazilian president Michel Temer threw EM bond markets into turmoil just as they had already suffered a torrid day on the back of a Donald Trump-provoked slump in global markets.