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Brady Bond Trading Recap

contributed by Credit Lyonnais Securities (USA) Inc.

Tuesday, April 25 2000

Daily Brady Bond Trading Commentary

Emerging markets debt prices surged Tuesday across the board on the back of a strong rebound in U.S. and local equity markets. Customer activity helped to boost prices, but trading activity remains dealer-led. Argentina plans to issue up to $3 billion in new global bonds in exchange for Bocones and Bradys within the next 90 days, which could allow the government to achieve NPV savings of over $400 million. The government also plans to offer the new bonds, which will come at two maturities, for cash. News of the deal lifted Brady Bond prices early in the day, but Argentine global bonds rallied as well, despite the substantial amount of new supply for that sector of the market. The country, which has typically run one to two quarters ahead in its external financing needs, has not yet met all of its Q2 funding requirements. The bottom line is that there will be plenty more to come from the government of Argentina this year, market conditions permitting.
This report was prepared by Credit Lyonnais Securities (USA) Inc. The information and statistical data herein have been obtained from sources we believe to be reliable but in no way are warranted by us as to accuracy or completeness. Returns set forth in this report are estimates based on internal assumptions, and any changes in these assumptions may have material impact on such estimated returns. This is not a solicitation or any offer to buy or sell securities. We, our affiliates, and any officer, director or stockholder or any member of their families, may have a position in and may from time to time purchase or sell any of the above mentioned or related securities.
 

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