Weekly Updates

Executive Summary: Emerging market credit traded with a constructive tone, supported by ongoing multilateral funding and improving sovereign credit momentum, particularly in Argentina and Ukraine. Price action was led by restructuring-driven gains in select LatAm corporates, while weaker credits underperformed on refinancing risks. Asia HY remained broadly stable with pockets of idiosyncratic volatility, and profit taking emerging after recent rallies. Frontier sovereigns benefited from softer oil prices and improved sentiment, with Indonesia supported by policy actions and renewed primary issuance.

Market Visualizer

Regional Credit Developments

🌍 EM Ex-Asia Credit

• Argentina: S&P upgraded sovereign to B- (Stable); USD bonds +1.375–3.0 pts, EUR bonds +1.875–3.0 pts, GDP warrants +0.375–0.75 pts WoW.
• Ukraine: Partial reform progress with IMF tranche approved; EUR 8.35bn EU support expected; bonds +1.0–1.75 pts.
• Zambia: 97.9% participation in eurobond tender; 2033 bonds +0.125 pts.
• Mozambique: $450mm World Bank grant secured; 2031 bonds +0.70 pts.
• Egypt: Gulf deposits fully rolled including USD2bn Kuwait rollover; bonds flat to +0.875 pts (2033s +0.375, 2050s +1.875).
• Naftogaz: Restructuring agreed with maturity extensions and 8.95% coupons; bonds +3.5–5.5 pts.
• CSN: Advancing restructuring and BRL12–13bn asset sale discussions; bonds +1.375–2.125 pts.
• Brazil Airlines: Applying for BRL5.5bn BNDES program; AZULBZ/GOLLBZ unchanged, Latam flat.
• Aegea: Downgraded to B+ on weaker financial profile; bonds -0.375–0.625 pts.
• Braskem: Exploring restructuring terms including maturity extension and coupon cuts; bonds -1.0–2.0 pts.
• Celulosa Arauco: Downgraded to BBB- on higher leverage; bonds flat.
• Volcan: Upgraded to B1 with new issuance plans; bonds unchanged.
• SoftBank: Equity -12.8%; bonds -0.50 to -1.0 pts.
• Petroperu: Seeking CESCE waiver ahead of payment deadlines; bonds +1.50 pts (2032s) and +0.25 pts (2047s).

🇨🇳 Asia Credit: China Property & HY

• China/HK HY: Mixed week; China HY +0–0.25 pts with HK credits outperforming.
• Lasu De / HK Credits: LASUDE 26s +4–5 pts on asset sale progress; demand in NWD perps and LIFUNG.
• Vanke: Bonds -4 pts WoW.
• GLP: Curve -1.5–2.0 pts on profit taking.
• Vedanta: Tender and new issuance roadshow; bonds +0.25 pts.

🌏 Asia Credit: Frontier & Sovereign

• Pakistan & Sri Lanka: Bonds +0.5–1.0 pts on lower oil prices.
• Indonesia (Macro): BI hiked rates 25bps; JCI +7.4% on improved sentiment.
• Indonesia (Primary): Danantara issued $1.5bn; sovereigns +0.25–0.5 pts, quasis mixed.
• Indonesia HY: HY -0.25–0.5 pts with INDYIJ and JAPSP outperforming.

DISCLAIMER

This document is strictly confidential and is being provided to you for informational purposes only. It does not constitute an offer to sell or a solicitation of an offer to buy any securities or financial instruments. The information contained herein has been obtained from sources believed to be reliable but is not guaranteed as to accuracy or completeness. Opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.

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