Morning Commentary: EM active; spreads mostly steady; Emirates NBD prices; Chile on deck

By Rebecca Melvin

New York, Jan. 29 – Emerging markets’ spreads were for the most part steady, but the space was active on Monday given a drop in U.S. Treasury rates. Oil prices were also a little lower, but Gulf Cooperation Council countries were little changed to 2 basis points tighter, according to a market source.

Meanwhile Iraq was steady at 20 bps tighter on the week and marked 25 cents lower on the day on the 2023 and 2028 notes.

Bahrain’s sovereign 2047 notes traded in good size and closed at 98.50 bid, 98.75 offered, with its spread also tighter on the month and holding steady.

Dubai’s Emirates NBD PJSC priced a CHF 235 million offering of five-year senior notes with a 5/8% coupon at 100.012 to yield mid-swaps plus 60 bps.

But the Regulation S notes weren’t expected to be a big feature of the day’s action as Swiss franc deals are typically targeted to Swiss banks and funds.

Also in early action, Dubai-based Shelf Drilling Holdings Ltd., an offshore rig operator, started to market a $550 million offering of seven-year senior notes (B2/B-), with pricing of a deal expected after meetings wrap up on Wednesday.

Credit Suisse Securities (USA) LLC is the lead bookrunner for the Rule 144A and Regulation S for life offering. Clarksons, DNB Markets, ING and UBS Investment Bank are the joint bookrunners.

Elsewhere, Chile was talking an offering of dollar-denominated 10-year global notes with a yield in the U.S. Treasuries plus 75 bps area for Monday’s business.

The deal was marketing concurrently with a tender for certain bonds. The Securities and Exchange Commission-registered notes are being sold via Citigroup, Goldman Sachs & Co., J.P. Morgan Securities and BofA Merrill Lynch as joint lead managers and bookrunners of the new deal.

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