World Cup

  • 22 Jun 2006 at 2:39 PM
  • World Cup

Eliminating the World Cup

worldcup.jpgBankersball brings us the news that at least one bank has attempted to ban the World Cup.

Word on the Street is that many are unhappy about a certain bank’s move to attempt to block World Cup access from TVs. It appears the change came after the said bank was recently named in a prominent publication as having a good many of their televisions turned to the matches.

It’s too bad Bankersball ran this as a blind item. We want to know which banks and trading floors have the World Cup on and which don’t. Leave your tips or speculations in the comments section or email Tips(at)Dealbreaker(dot)com.

World Cup Woes
[Bankersball]

  • 09 Jun 2006 at 4:06 PM
  • World Cup

More World Cup Emerging Market Madness

malaysia.jpgThe Brazil Bond story got us wondering. Where else is the World Cup wreaking havoc on capital markets?
First stop: Malaysia, where stocks fell to three-moth lows yesterday. (And, yes, we included the pic of Miss Malaysia because, uhm, well we kind of forget why.) According to the Business Times,

Analysts expect the trend to continue, at least until the World Cup period is over. The World Cup, which starts tomorrow will end a month later.
“It is summer in the US now. Moreover, with World Cup around the corner, fund managers are likely to be out of action,” an analyst said.

Next stop: all of Latin America!

Latin America’s fixation with the football World Cup in the next month is likely to lower volumes in the region’s financial markets, but opinions differ on whether it will dampen the volatility which rocked emerging markets around the world in the past month.
With Brazil markets closing early on game days, the Argentine stock market bringing in a giant screen to watch the tournament, and traders betting electronically in Mexico, investors’ attention could drift unless global markets tremble, analysts said.

Developing…

  • 09 Jun 2006 at 3:02 PM
  • World Cup

Brazil’s Bond Buyback

bundchen.jpgA reader shares his not-quite-business as usual experience in the world of emerging markets debt trading.

Not that this is something people outside EM investment world would know, but Brazil a few days ago announced a tender offer for up to $4bio of its outstanding Eurobonds. Holders had to submit their offer prices yesterday afternoon.
The terms of the tender offer called for Brazil to announce the results at 10am this morning. The timing is important, because for the time between when holders tender their bonds and when Brazil decided whether to take them or not, the Brazilians effectively have a free call option on the debt. 10am rolled around and there were no results. 10:30am, still no results. 11:00am, the leads plead for a few more minutes.
I begin to suspect that the Brazilians understand that they have this free option and they are maximizing its value by unilaterally extending the expiry. I call the leads and make this point at 11:30am, when there are still no results and bond prices have moved well above the minimum tender prices. At noon, I start threatening to contact the SEC if my bonds get taken below market. At 12:45pm, the leads say the results will be out imminently.
At 1:00pm on the dot, the results are published, and the Brazilians paid up massively for the bonds. Huh? What was the point of abusing the tender and stretching it out if you then pay over the odds for tendered bonds. Then, suddenly it hit me. World Cup match halftime started at 12:45pm. And ended at 1:00pm. The lazy turds waited until halftime to deal with the tender. Gotta love the Brazilians Treasury’s priorities.

Send more World Cup related stories to TIPS (at) DealBreaker (dot) Com. (No apologies for the completely gratuitous Shakira Giselle Bundchen picture.)