Eyeing trades amid a struggling Chinese economy and opportunities in Turkish bonds and EM distressed debt

Nick Eisinger, co-head of emerging markets active fixed income fund at Vanguard, unpacks his views on a struggling Chinese economy and the wider implications on global markets. Despite the growing concerns for the world’s second-largest economy, he says it “doesn’t mean there are no trades in China” and discusses where there could be potential for the upside.

Elsewhere in emerging markets (EM), Eisinger discusses the recent shakeup at Turkey’s central bank and whether now is the prime time to invest in Turkish local bonds and foreign exchange.

Turning to riskier debt, the co-head of EM active fixed income provides a comprehensive outlook on the distressed debt markets and where he sees potential for growth and investment opportunities.

In this episode, he also looks at what could move markets this week and what might impact liquidity, as desks await important inflation data out of the US and the UK and GDP growth numbers out of Europe.

North America: Weekly Review and Outlook

  • US equities volumes fell week on week but remained elevated, with a skew to buying activity. Liquidity gradually worsened week on week.
  • US IG volumes fell but remained elevated, yet bid-ask spreads widened compared to the last week of January.
  • Data: US Inflation rate on February 13, initial jobless claims on February 15, and Producer Price Changes on February 16. Earnings e.g. Coca Cola
  • In primary equities: 4 IPOs expected to price at $26.8 million. The largest deal should be Metros Development at $8.5 million.

Europe and the UK: Weekly Review and Outlook

  • Equities volumes fell week on week but remained high and saw downward pressure. Liquidity worsened week on week.
  • Euro IG volumes remain high and bid-ask spreads widened and are wide for seasonal averages between 2019 and 2022.
  • Data: UK’s Unemployment rate on February 13, UK’s Inflation rate and the EU’s GDP Growth on February 14, and the UK’s GDP Growth on February 15.
  • In primary equities: There are no IPOs expected to price on European exchanges this week.

To watch other Trader TV: This Week shows go to – https://tradertv.net/videos/this-week

Published on February 12, 2024

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