Russian bonds struggle; roadshows ahead for Bahrain, Hong Kong; Burgan Bank taps leads

By Christine Van Dusen

Atlanta, Aug. 28 – Bonds from Russia were weak at the start of Thursday’s session on news that the sovereign’s troops made further incursions into Ukraine and that further sanctions from the West are forthcoming.

Russian credit default swaps spreads moved out 12 bps on Thursday. Turkey’s CDS, meanwhile, widened 5 bps.

Ukraine’s bonds have dipped so far this week as investors try to make sense of the conflict and comments from Tuesday’s summit with Russian leaders in Minsk, said Svitlana Rusakova of Dragon Capital.

Overall, “[emerging markets] is opening a little weaker,” a London-based analyst said. “But most of the focus is on Russian developments this morning.”

Middle Eastern bonds put in a “fairly active day,” a London-based trader said. “Lower-beta names trade well. Long-dated bonds, corporate-wise, remain solidly in demand.”

In deal-related news, Bahrain will set out on Sept. 2 for a roadshow to market a dollar-denominated issue of notes, a syndicate source said.

Hong Kong will set out on Sept. 1 for a roadshow to market a dollar-denominated issue of Islamic bonds, according to an announcement from the sovereign.

Kuwait’s Burgan Bank SAK has mandated HSBC, Citigroup, JPMorgan and National Bank of Abu Dhabi as bookrunners for an issue of notes, a market source said.

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