Mumtalakat, Turkey sell notes; Russia, Ukraine remain in spotlight; ‘choppy’ for Petrobras

By Christine Van Dusen

Atlanta, Nov. 18 – Bahrain Mumtalakat Holding Co. BSC and Turkey sold notes on Tuesday during a better session for bonds from Central and emerging Europe, the Middle East and Asia.

Buyers were seen for front-end paper from Russian corporates, including OAO Rosneft’s 2017s and OAO Novatek’s 2016s, a London-based analyst said.

“Certain Russian sovereign bonds are also trading up, due to short squeezes,” he said.

This came as leaders from Ukraine and Russia argued over a possible cease-fire agreement and the European Union added more than 100 Ukrainian and Russian names to a blacklist.

Looking to Latin America, trading was “very choppy” for Brazil-based Petroleo Brasileiro SA as the company tried to weather a money-laundering and corruption scandal, a New York-based trader said.

The company’s 2021s managed to tighten as much as 25 basis points in early trading while the short end of the curve struggled, barely tightening, he said.

Petrobras’ 2019s fared the worst, with a high price and a weak spot in the curve, and widened a whopping 80 bps on Tuesday.

“It normally runs about 25 bps to 30 bps wide,” he said.

Sellers were seen for Brazil-based Vale SA’s most liquid bonds, with the 2022s, 2036s, 2039s and 2042s moving out about 12 bps.

From Mexico, the curve for Cemex SAB de CV was stable on Tuesday and drifted slightly lower amid scant selling, the New York trader said.

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