J.P. Morgan & Co. and Chase Manhattan Corp. have underwritten a $1.5 billion bond issue for Mexico, the second big issue to come out of Latin America this year.

Banking sources said both the narrow margin of the 10-year issue's yield over equivalent U.S. Treasury securities and the fact that the issue was increased to $1.5 billion, from $1 billion, point to a marked strengthening of demand for emerging-market paper.

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