ENAP, NTPC sell notes; Lat-Am catches a bid, spreads tighten; Vale Overseas advances deal

By Christine Van Dusen

Atlanta, Aug. 3 – Chile’s Empresa Nacional del Petroleo (ENAP) and India’s NTPC Ltd. sold notes on Wednesday as Latin American bonds were “relentlessly bid” and Turkey’s sovereign notes widened.

“Latin American credit goes relentlessly bid today, with spreads tightening and cash prices gapping higher,” a New York-based trader said. “Brazil continues to outperform and has five-year credit default swaps closing at 284 basis points from 294 bps. Brazil cash gapped higher by multiple points late in the afternoon, with buyers seeking the 2026s and 2047s in particular.”

Five-year credit default swaps spreads for Mexico closed Wednesday at 153 bps from 158 bps, underperforming, “but cash made a nice bounce late in the day and does close higher,” he said.

Bonds from Argentina moved higher while Venezuela and PDVSA moved lower, with Argentina’s Bonar 2024s closing at 116 from 115.70 and the 2026s at 108.10 from 107.60, he said.

Petroleos Mexicanos SAB de CV (Pemex) was well-offered, with prices off by about 25 cents to 50 cents, another trader said.

“Most credits continue to get pulled lower to varying degrees,” he said. “Most, if not all, credits continue to trade with a strong technical aspect. Dealers trying to stay nimble as summer doldrums quickly approach and oil and equities are also under consistent pressure.”

In deal-related news, Brazil’s Vale Overseas Ltd. is planning to issue dollar-denominated notes, according to a company filing.

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