KrisEnergy prices; new violence keeps Russia, Ukraine in focus; China Construction eyed

By Christine Van Dusen

Atlanta, Aug. 18 – Indonesia’s KrisEnergy sold notes on Monday as risk sentiment at first improved – after leaders from Russia and Ukraine met to discuss a ceasefire – then gave way to caution as new violence was reported.

A bus convoy from Ukraine was hit by rocket fire on Monday, according to news reports, and numerous people were killed. Ukrainian officials blamed pro-Russia rebels, who said they were not involved and that perhaps an attack never occurred.

Market experts urged caution, with Commerzbank strategists suggesting underweight positions in the two sovereigns while the negotiations continue.

“The positive, so far, has been Russia’s statement that it will ensure no illegal border crossing from its own side,” said analyst Tatha Ghose. “This reassurance by the government is crucial and could bring temporary reprieve.”

In the morning, Russian sovereign bonds improved just slightly, with the 3½% 2019 notes that priced at 99.195 trading Monday at 99.5 bid, par offered.

The sovereign’s 4 7/8% notes due 2023 that priced at 98.162 were spotted at 100.25 bid, 100.75 offered.

And Russia’s 3 5/8% notes due in 2020 that priced at 99.533 climbed to 101.25 bid, 101.75 offered.

Meanwhile, China Construction Bank’s new issue of $750 million 4¼% notes due 2024 that priced at 99.577 drew a final order book of more than $3.5 billion from 175 orders, a market source said.

© 2015 Prospect News.
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