Primary hosts Bulgaria, Ecuador, Peru, Armenia; Asian rally fizzles; roadshows ahead

By Christine Van Dusen

Atlanta, March 19 – Bulgaria, Ecuador, Peru and Armenia priced notes on Thursday amid a mostly defensive tone for emerging markets assets.

Asian bonds were firm at the start of Thursday’s session after the Federal Reserve’s Wednesday night comments, with spreads tightening between 1 basis point and 3 bps, a London-based trader said.

“However, the rally fizzled, with sellers into strength, and high-grade cash closed the day unchanged,” he said. “Tone, overall, feels defensive.”

Recent new issues were mixed, with Industrial and Commercial Bank of China Ltd.’s five-year notes closing unchanged and Malaysia-based Petroliam Nasional Bhd.’s (Petronas) curve rallying 1 bp to 3 bps tighter amid profit-taking.

The latter deal included $1.25 billion 2.707% Islamic bonds due 2020 that priced at par to yield Treasuries plus 110 bps. On Thursday the notes were seen at 115 bps, down from Wednesday’s 116 bps.

And the $1.5 billion 4½% notes due 2045 that priced at 98.767 to yield Treasuries plus 190 bps traded down to the wides of 206 bps but rebounded up to 203 bps with buyers from Europe, he said.

Oil companies from China were mostly unchanged to a couple of basis points tighter, he said.

In deal-related news, Indonesia’s PT Astra Sedaya Finance, South Korea’s Shinhan Bank and Korea Resources Corp. set roadshows while National Bank of Kuwait looked to issue in April. Market sources were also whispering about a possible issue from Senegal.

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