Morning Commentary: Qatar response expected by Sunday deadline; Banorte higher

By Colin Hanner

Chicago, June 30 – Though the calendar looked soft at week’s end in emerging markets, with a lower-than-usual volume of issues to come to market next week due to the upcoming July 4 holiday in the United States, a market source said the secondary may not be quiet since news is expected from Qatar over the weekend.

The dispute that began nearly a month ago on June 5 between several Middle Eastern countries and Qatar could be nearing a tipping point. Qatar has been told to respond by Sunday to a list of demands, which includes curbing relations with Iran and cutting associations with extremist organizations, made by Saudi Arabia, United Arab Emirates, Bahrain and Egypt.

Qatar is working with Kuwait and the United States to negotiate a response, according to media reports.

In the pipeline, Kazakhstan’s Nostrum Oil & Gas plc will begin a roadshow on Monday for dollar-denominated benchmark size sale of medium-term notes, a market source said. Meetings will take place in Europe and the United States.

The new issue for the oil and gas exploration and production company is concurrent with a tender offer for two sets of notes due 2019.

Tauron dips

In the secondary market Friday, Tauron Polska Energia SA’s €500 million of 10-year 2 3/8% senior notes, which came at a reoffer price of 99.438 to yield 2.44% on Thursday, were trading lower on Friday.

A market source quoted the notes at a 100.15 bid, 100.45 offer, about 20 bps off Thursday’s levels.

Banorte up from issue

And both tranches of the $900 million issue of perpetuals from Mexico’s Banco Mercantil del Norte SA – $350 million of 6 7/8% notes non-callable for five years and $650 million of 7 5/8% notes non-callable for 10 years – were trading higher.

The 6 7/8% notes were trading 1 point higher at 101 from their par issuance level and the 7 5/8% notes were trading at 101.41, nearly 1½ points higher than the price of par at which they came to market.

© 2015 Prospect News.
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