Saudi Arabia credit widens slightly; Brazil, LatAm weaker; Grupo Cementos de Chihuahua prices

By Rebecca Melvin

New York, June 21 – Saudi Arabia’s credit widened somewhat on Wednesday as Saudi equities rallied on news that Saudi Arabia’s King Salman promoted his son Mohammed bin Salam to Crown Prince from Deputy Crown Prince, replacing the king’s nephew, according to market sources.

Saudi Arabia’s $9 billion of notes due 2022 and 2027, which were priced in April, were seen at 100.40 bid, 100.60 offered and 102.37 bid, 102,63 offered, respectively, on Wednesday, according to a market source. On June 12, the 2022 notes were 99.93 bid, 100.18 offered and the 2027 notes were 101¾ bid, 102 offered.

The Saudi leadership news came as market players were watching an ongoing plunge in global oil prices. On Tuesday, prices fell into bear market territory and on Wednesday, prices slipped further as investors reject the notion that oversupply problems will come into balance any time soon.

In Latin America credit markets, prices of sovereign and corporate debt were “quite a bit weaker especially in Brazil,” a New York-based trader said.

The most noticeable decliner was Petroleo Brasileiro SA. Its bonds were seen down about one point across the board, the trader said.

Also from Latin America, Mexico’s Grupo Cementos de Chihuahua SAB de CV (GCC) sold $260 million of seven-year notes at par to yield 5¼% on Tuesday, market sources said.

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