Yesterday, someone threw in the towel on EM bonds. The Van Eck JP Morgan Emerging Market Local Currency Debt ETF (EMLC) is the largest and most liquid vehicle to invest in emerging market local currency bonds. In one trade yesterday, someone pushed through a block of 18,841,690 shares, valued at around $320M. Interestingly, the price only fell 1.5 cents on that volume.

In the chart below, I show the price and volume for the EMLC over the previous five years. Yesterday’s action is extreme by any metric. For an ETF that normally trades around 3 million shares per day, this was an explosion of 10x the normal daily volume.

Both US investment grade and EM spreads have been widening recently as oil prices consolidate.