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Brady Bond Trading Recap

contributed by Credit Lyonnais Securities (USA) Inc.

Thursday, February 10 2000

Daily Brady Bond Trading Commentary

Emerging markets debt prices continue to rally, and last week's ratings announcement regarding Mexico is still a driving force. An actual upgrade by Moody's in the near future would lead to further tightening of Mexican debt (a split rating should drive credit spreads easily inside of 225 bps, and quite possibly inside of 200). In the less likely case that Moody's does not follow through on its upgrade review, the market would be caught off guard, to say the least. Sustaining the recent trend of positive announcements, Standard & Poor's raised its outlook on Argentina (BB) to stable from negative. Momentum still favors playing from the long side, though we expect to see profit-taking keep the upside limited.
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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