Emerging market borrowers issued a record USD 57.5 bn in bonds since the beginning of 2025, a 28.9% y-o-y increase from USD 44.6 bn during the same period last year, Reuters reported citing Morgan Stanley data. As borrowers rush to lock in proceeds before Trump takes charge, analysts warn that the growing appetite is at risk of a market shift.

By the numbers: Top issuers included Saudi Arabia, which sold bonds worth USD 12 bn last week, while Mexico recorded USD 8.5 bn and Chile recorded USD 3 bn in sales. Average premiums range between 0 and 10 basis points above US treasuries, with EUR-denominated bonds making a strong comeback. Sovereign borrowers, including Saudi and Indonesia, are mitigating higher yields by favoring shorter maturities over traditional 30-year bonds, the newswire said.

The drivers: This surge in borrowing is driven by fears of market volatility ahead of the second Donald Trump administration, uncertainty around the US Federal Reserve’s interest rate plans, and inflation concerns, Stefan Weiler, JPMorgan's head of CEEMEA debt capital markets, told Reuters. Emerging markets are also under pressure from USD 500 bn in short-term debt issued during covid, set to mature this year.

The trend is expected to continue: Borrowers are expected to issue another USD 30 bn in debt before 20 January, Weiler added. The trend could also continue well into 1H 2025, according to Matt Doherty, head of CEEMEA syndicate at BNP Paribas. “I wouldn't be surprised if you have another first half where we see the best part of USD 200 bn in issuance from CEEMEA,” Doherty told Reuters.

MARKETS THIS MORNING-

Asian markets are mixed in early trading, largely mirroring a mixed trading session for Wall Street yesterday that ended last night with tech stocks falling. Mainland China’s CSI 300 and the Hang Seng Index are each up 1.2% and Shanghai is similarly up 1.3%, while Japan’s Nikkei is firmly in the red so far this morning.

Futures indicate Wall Street is set to open in the green, suggesting the Dow Jones will continue rising after closing up 0.9% yesterday.

TASI

12,110

-0.1% (YTD: +0.6%)

MSCI Tadawul 30

15,110

-0.2% (YTD: 0.0%)

NomuC

31,234

+0.6% (YTD: -0.8%)

USD : SAR (SAMA)

USD 3.75 Sell

USD 3.75 Buy

Interest rates

5.0% repo

4.5% reverse repo

EGX30

28,556

-2.5% (YTD: -4.0%)

ADX

9,459

-0.4% (YTD: +0.4%)

DFM

5,233

+0.1% (YTD: +1.4%)

S&P 500

5,836

+0.2% (YTD: -0.8%)

FTSE 100

8,224

-0.3% (YTD: +0.6%)

Euro Stoxx 50

4,954

-0.5% (YTD: +1.2%)

Brent crude

USD 80.90

+1.4%

Natural gas (Nymex)

USD 3.93

-1.4%

Gold

USD 2678.60

-1.3%

BTC

USD 94,307.70

-0.1% (YTD: +0.8%)

THE CLOSING BELL: TADAWUL-

The TASI fell 0.1% yesterday on turnover of SAR 5.8 bn. The index is up 0.6% YTD.

In the green: Buruj (+10%), UIHC (+8%) and Gulf General (+4.4%).

In the red: Cenomi Retail (-5.6%), Jamjoom Pharma (-4.1%) and MESC (-3.5%).

THE CLOSING BELL: NOMU-

The NomuC rose 0.6% yesterday on turnover of SAR 60.1 mn. The index is down 0.8% YTD.

In the green: Multi Business (+13.6%), Alqemam (+9.3%) and First Avenue (+7.3%).

In the red: Alrazi (-10.6%), Quara (-6.3%) and Aictec (-5%)

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