A Weaker Technology Sector Boosted the Demand of US Treasuries
The BLOM Bond Index (BBI) concluded the week rising by 0.29%, to stand at 100.95 points. Moreover, the JP Morgan Emerging Markets’ Bond Index (EMBI) registered the same rise of 0.29% during the week to close at 791.2 points.
The demand for 5 year (5Y) and 10Y Lebanese Eurobonds weakened during this week as their respective yields fell from 6.74% and 7.58% to 6.58% and 7.51%.
In the USA this week, safe-haven demand increased as a result of Wall Street’s stocks plunging as the technology sector weakened on government scrutiny over political consultants’ use of Facebook’s user data.
The yields on the 5Y and 10Y US treasuries dropped up over the week, from 2.63% and 2.83% last week to 2.59% and 2.77%, respectively.
As such, the 5Y and 10Y spreads between the yield on the Lebanese Eurobonds and its US comparable narrowed from 411 basis points (bps) and 475 bps last week to 399 bps and 474 bps this week.
5 Year Credit Default Swaps, Mid-Prices (in basis points)
| 28/03/2018 | 22/03/2018 | |
| Lebanon | 457 | 450 |
| KSA | 85 | 84 |
| Dubai | 106 | 101 |
| Brazil | 168 | 166 |
| Turkey | 202 | 196 |
Weekly Change of Lebanese Eurobonds Prices
| Prices | Weekly | Yields | Weekly | ||||
| Maturity | Coupon in % | 28/03/2018 | 22/03/2018 | Change | 28/03/2018 | 22/03/2018 | Change bps |
| 23/04/2019 | 5.5 | 99.75 | 99.5 | 0.25% | 5.74% | 5.98% | -24 |
| 20/05/2019 | 6 | 100.25 | 100 | 0.25% | 5.76% | 5.99% | -23 |
| 28/11/2019 | 5.45 | 99.25 | 99 | 0.25% | 5.92% | 6.08% | -15 |
| 09/03/2020 | 6.375 | 100.5 | 100.25 | 0.25% | 6.10% | 6.24% | -14 |
| 14/04/2020 | 5.8 | 99.25 | 99.13 | 0.12% | 6.19% | 6.25% | -6 |
| 19/06/2020 | 6.15 | 99.75 | 99.63 | 0.12% | 6.27% | 6.32% | -6 |
| 12/04/2021 | 8.25 | 104.88 | 104.38 | 0.48% | 6.45% | 6.64% | -19 |
| 04/10/2022 | 6.1 | 97.88 | 97.25 | 0.65% | 6.65% | 6.81% | -16 |
| 27/01/2023 | 6 | 97 | 96.38 | 0.64% | 6.74% | 6.89% | -15 |
| 22/04/2024 | 6.65 | 98.5 | 98.25 | 0.25% | 6.96% | 7.01% | -5 |
| 04/11/2024 | 6.25 | 96 | 95.75 | 0.26% | 7.02% | 7.06% | -5 |
| 03/12/2024 | 7.00 | 99.5 | 99.5 | 0.00% | 7.09% | 7.09% | 0 |
| 26/02/2025 | 6.20 | 94.88 | 95 | -0.13% | 7.15% | 7.13% | 2 |
| 12/06/2025 | 6.25 | 94.75 | 95 | -0.26% | 7.19% | 7.15% | 5 |
| 28/11/2026 | 6.60 | 94.75 | 94.63 | 0.13% | 7.43% | 7.45% | -2 |
| 23/03/2027 | 6.85 | 95.75 | 95.25 | 0.52% | 7.51% | 7.59% | -8 |
| 29/11/2027 | 6.75 | 94.63 | 94.13 | 0.53% | 7.54% | 7.62% | -8 |
| 03/11/2028 | 6.65 | 93.38 | 92.75 | 0.68% | 7.57% | 7.66% | -9 |
| 26/02/2030 | 6.65 | 91.5 | 91.38 | 0.13% | 7.75% | 7.77% | -2 |
| 22/04/2031 | 7.00 | 93.38 | 93.5 | -0.13% | 7.82% | 7.80% | 2 |
| 23/03/2032 | 7.00 | 92.75 | 92.75 | 0.00% | 7.86% | 7.86% | 0 |
| 02/11/2035 | 7.05 | 92.13 | 92 | 0.14% | 7.88% | 7.90% | -1 |
| 23/03/2037 | 7.25 | 93.13 | 92.75 | 0.41% | 7.96% | 8.00% | -4 |
