In today’s briefing:
- Gerdau 3Q25: North America Drives Earnings as Brazil Margins Compress
- Lucror Analytics – Morning Views Asia
Gerdau 3Q25: North America Drives Earnings as Brazil Margins Compress
- Persistent pricing pressure in Brazil limits margin recovery, while reduced future investments highlight challenges; stronger trade-defense measures will be needed to restore competitiveness.
- North America remains Gerdau’s key earnings driver, supported by tariffs, healthy construction demand, and a resilient balance sheet that underpins credit strength.
- We maintain Neutral, seeing limited spread-compression potential; we find greater value in the 2044s for their yield pickup and see overall valuations close to fair value across the curve.
Lucror Analytics – Morning Views Asia
- In today’s Morning Views publication we comment on developments of the following high yield issuers: Softbank Group, China Vanke
- UST yields were mixed yesterday. The UST curve twisted slightly steeper, with the yield on the 2Y UST rising 2 bps to 3.48%, while the 10Y was unchanged at 4.00%. Equities rose for a fourth day, supported by a continued recovery in tech stocks. The S&P 500 and Nasdaq climbed 0.7% and 0.8% to 6,813 and 23,215, respectively.
- The Fed Beige Book for November 2025 showed that overall consumer spending had declined further since the October report.
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