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from Global Investing:
Emerging corporate debt tips the scales
Time was when investing in emerging markets meant buying dollar bonds issued by developing countries' governments.
How old fashioned. These days it's more about emerging corporate bonds, if the emerging market gurus at JP Morgan are to be believed. According to them, the stock of debt from emerging market companies now exceeds that of dollar bonds issued by emerging governments for the first time ever.
JP Morgan, which runs the most widely used emerging debt indices, says its main EM corporate bond benchmark, the CEMBI Broad, now lists $469 billion in corporate bonds. That compares to $463 billion benchmarked to its main sovereign dollar bond index, the EMBI Global. In fact, the entire corporate debt market (if one also considers debt that is not eligible for the CEMBI) is now worth $974 billion, very close to the magic $1 trillion mark. Back in 2006, the figure was at$340 billion. JPM says:
The international primary market for EM has transformed into a corporate debt market, with sovereign issuance now less than one-third of total EM external issuance.
from Global Investing:
Emerging corporate debt tips the scales
Time was when investing in emerging markets meant buying dollar bonds issued by developing countries' governments.
How old fashioned. These days it's more about emerging corporate bonds, if the emerging market gurus at JP Morgan are to be believed. According to them, the stock of debt from emerging market companies now exceeds that of dollar bonds issued by emerging governments for the first time ever.
from Global Investing:
SocGen poll unearths more EM bulls in July
These are not the best of times for emerging markets but some investors don't seem too perturbed. According to Societe Generale, almost half the clients it surveys in its monthly snap poll of investors have turned bullish on emerging markets' near-term prospects. That is a big shift from June, when only 33 percent were optimistic on the sector. And less than a third of folk are bearish for the near-term outlook over the next couple of weeks, a drop of 20 percentage points over the past month.
These findings are perhaps not so surprising, given most risky assets have rallied off the lows of May. And a bailout of Spain's banks seems to have averted, at least temporarily, an immediate debt and banking crunch in the euro zone. What is more interesting is that despite a cloudy growth picture in the developing world, especially in the four big BRIC economies, almost two-thirds of the investors polled declared themselves bullish on emerging markets in the medium-term (the next 3 months) . That rose to almost 70 percent for real money investors. (the poll includes 46 real money accounts and 45 hedge funds from across the world).
Morning Line-Up: China’s pledge, bonus drop, BRIC optimism
News and views on the asset management industry from Reuters and elsewhere:
China promises Euro support – FT
