Belarus Bonds Sell off Amid Continued Protests


A rally in tech shares sent the NASDAQ to yet another record close on Monday despite the stalling of talks over the next stimulus package. The NASDAQ’s 1.00% gain saw it notch its 33rd closing record of the year with Tesla notably gaining 11.20%. The S&P closed 0.27% higher while the DOW shed 0.30%. Yield on 10Y USTs closed lower at 0.6882%.


Talks between the UK and the EU over a trade agreement will resume on Tuesday following a summer hiatus. The sticking points in the negotiations concern how closely the UK will adhere to bloc rules as well as how much access EU vessels will have to British fishing waters; the EU has made agreement on these a prerequisite to any broader trade deal. The pound and euro closed firmer at $1.3103 and $1.1870, respectively.


Asian stocks were mixed on Tuesday as squabbles in Washington have stalled talks on the next stimulus package. The ASX and the CSI were the bright spots on the day, up 0.77% and 0.25% respectively. The NIKKEI and HANG SENG were lower however at -0.20% and -0.13 respectively.


Turkey ran a budget deficit for a sixth month amid increased government spending to stem the impact of COVID-19 as well as government-instituted tax deferrals. The July fiscal deficit of 29.7 billion liras brought the year-to-date figure to 139.1 billion, already higher than the 123.7 billion liras recorded for the whole of 2019. The lira closed weaker at 7.3821 against the dollar while TURKEY 47s traded lower in the low 80 levels.


Belarus Eurobonds continued selling off with yield on BELRUS 31s shedding 30bps on Monday, already over a point higher for the month. This came as workers went on strike, joining protests that have rocked the country following a disputed election. Ruble-denominated bonds have not been spared either, with BELRUS 25s shedding 52bps to close at 10.03% yield. A Bloomberg Barclays index showed losses on BELRUS Eurobonds at 5.1% this month, the worst in emerging markets.


IVYCST bonds seem unmoved by protests that have rocked the country since President Ouattara announced his decision to run for a third term, a move in alleged violation of the constitution by his critics. Several deaths have been recorded so far in the clashes between rival protestors that have turned violent and bordering on tribal lines in some cases. IVYCST bonds appear unmoved so far however with IVYCST 32s trading in the 100 levels for about a week