Singapore’s Frasers sells notes; EM volatile ahead of non-farm payrolls; Turkey in focus

By Christine Van Dusen

Atlanta, May 5 – Singapore’s Frasers Hospitality Real Estate Investment Trust sold notes on a volatile Thursday for emerging markets assets, as investors awaited the latest non-farm payrolls data from the United States.

Five-year credit default swaps spreads for Brazil closed at 346 basis points from 343 bps after trading as wide as 350 bps earlier in the day.

Mexico’s ended at 170 bps from 171 bps, a trader said.

“Cash prices also finished mixed on the day, with some long-end bonds higher on U.S. Treasury strength, whereas others are mostly unchanged,” he said. “Lat-Am high yield has Venezuela finishing modestly higher, whereas Argentina is mostly unchanged after initially rallying.”

Venezuela’s 2027s closed at 41.50 from 40.50, PDVSA’s 2017s ended at 57 from 56.50, and Argentina’s Bonar 2024s finished at 109.50 from 109.35 while the 2026s moved to 101.15 from 101.25.

“Client flows on the quiet side today, but Street volumes were active, especially in the belly of the Mexican sovereign curve,” he said. “Seemed to be some position-squaring ahead of NFP, as we were unable to hold the rally seen at the open today.”

Investors were also keeping an eye on Turkey, where credit has “enjoyed a solid bid in the last two months, despite geopolitical risks stemming from Syria and the Kurdistan Workers’ Party, as well as emerging differences among the top two politicians,” another trader said.

But the risk is starting to rattle some market-watchers, and credit default swaps spreads moved 6 bps wider and the sovereign’s 2045s moved out 9 bps, he said.

Finansbank deal moves forward

In other news from Turkey, Turkiye Finans Katilim Bankasi AS (Finansbank) was in the news after Qatar National Bank’s bid for the lender reportedly received approval from the competition board, a strategist said.

“The news is another positive step and likely the last crucial hurdle towards completion, which is expected to take place this quarter,” he said.

Frasers sells notes

In its new deal, Singapore’s Frasers Hospitality REIT priced S$100 million 4.45% perpetual notes at par to yield 4.45%, according to a company filing and announcement.

This matched talk, set at 4.45%.

DBS Bank and OCBC Bank were the bookrunners for the Regulation S deal.

Frasers Hospitality is a luxury hotel chain based in Singapore.

The deal attracted orders in excess of S$500 million, with institutional investors accounting for 35% of the total orders, the company said.

Neuquen launches

Argentina’s Neuquen Province launched a $235 million issue of 12-year notes at 8 5/8%, a market source said.

The notes were talked in the 9½% area.

Deutsche Bank and JPMorgan are the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used to make an exchange offer on the province’s outstanding 7 7/8% notes due in 2021.

Mendoza plans roadshow

Argentina’s Province of Mendoza will set out on Friday for a roadshow for a dollar-denominated issue of notes, a market source said.

Citigroup and Credit Suisse are the bookrunners for the Rule 144A and Regulation S deal.

The roadshow is expected to start in London and travel to Los Angeles and Boston before concluding on May 11 in New York.

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