Greece tumult has investors sidelined; Petrobras and Vale outperform; roadshows ahead

By Christine Van Dusen

Atlanta, June 12 – Asian credits softened and Latin American bonds saw very low volumes on Friday as investors awaited clarity on Greece and markets faced continued volatility in U.S. Treasuries.

This weekend, Greece is expected to present its creditors with new debt-reconstruction proposals. The sovereign’s current bailout expires at the end of this month.

“Seen profit-taking in performers while real-money demand was missing on the other end,” a London-based trader said.

From Latin America, trading was slow on Friday, though the new issue from Brazil’s Petroleo Brasileiro SA (Petrobras) managed to outperform the curve and the market, a New York-based trader said.

The 6.85% notes due 2115 priced at 81.070 to yield 8.45%, or Treasuries plus 549.3 basis points.

On Friday the bonds tightened in about 5 bps to close in on 500 bps, he said.

Brazil-based Vale SA saw its bonds tighten too, this time about 3 bps, the New York trader said.

In deal-related news, Mongolia is expected to print $350 million of new bonds this year.

South Korea’s KB Kookmin Bank will set out on June 15 for a roadshow to market a dollar-denominated issue of notes.

AES Panama SRL will depart on June 15 for a roadshow to market a possible issue of notes.

And India’s Power Finance Corp. Ltd. will market a dollar-denominated issue of bonds during the week of June 15.

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