Primary hosts China’s Sino-Ocean, CAR; Middle East busy; investors eye Petrobras earnings

By Christine Van Dusen

Atlanta, Jan. 28 – China’s Sino-Ocean Land Holdings Ltd. and China’s CAR Inc. sold notes on Wednesday during a busy and balanced trading session for many emerging markets bonds, including those from the Middle East.

Kuwait-based Burgan Bank saw two-way activity on it perpetual bond while investors nibbled at Dubai Islamic Bank PJSC’s paper, a trader said.

One trader was hopeful that February would bring new issuance from the Gulf region.

“Personally I think some issuers, even though they technically don’t ‘need’ the cash, should or will start to take a look at the market,” he said. “Long-dated bonds are a good 45 basis points to 55 bps wider on the month now ahead of rumored supply next month.”

Looking to Latin America, spreads for Brazil-based Petroleo Brasiliero SA (Petrobras) widened, then tightened to finish Wednesday about 12 bps to 14 bps wider, a New York-based trader said.

The state-run oil company reported its awaited third-quarter results on Wednesday but didn’t include the costs associated with an ongoing corruption scandal, a move that made investors anxious before cooler heads prevailed.

“Maybe investors are starting to put a little more focus on the positive aspects of the report, such as cutting down the investment plan,” the New York trader said. “The company is also stating that they have sufficient liquidity to cover the whole year.”

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