EM bonds stable but quiet; Middle Eastern names close unchanged; Air India may issue notes

By Christine Van Dusen

Atlanta, Aug. 9 - Emerging markets assets were stable but saw little trading on Thursday as the summertime slowdown, as well as a lack of details on next steps in solving the global debt crisis, kept volumes thin and issuance at a standstill.

"Markets broadly remain relatively range-bound given the paucity of market-moving economic data and a lack of further details on the European Central Bank's bond-buying proposals," according to a report from Barclays Capital. "The rally in short Spanish and Italian yields since the ECB press conference suggests markets think ECB intervention will be up to the two- to three-year sector."

Risk assets from Central and Eastern Europe, particularly those from Hungary and Poland, saw some widening on the long end of their yield curves, a Vienna-based market source said.

Notes from Sharjah Islamic Bank weren't trading much on Thursday, but they were holding well, a trader said.

The company's 4.715% notes due 2016 were seen at 106.62 bid, 107.62 offered.

Bahrain's 2014 notes were unchanged on Thursday at 106.25 bid, 107.25 offered.

The sovereign's 2022 notes were seen Thursday at 100.66 bid, 101.16 offered. Those notes closed Wednesday at 100.62 bid, 101.12 offered.

Bonds from Bahrain's BBK bank and Mumtalakat were not very liquid on Thursday.

BBK's 2015 notes that closed Wednesday at par bid, 101 offered were unchanged on Thursday.

Mumtalakat's 2015 bonds traded Thursday at 101.25 bid, 102.25 offered after closing Wednesday at 101 bid, 102 offered.

Meanwhile, the primary market was very quiet on Thursday, with market sources just whispering about a possible 19-year bond from Air India that could come to the market as soon as the end of this month.

NBAD trades up

In trading on Thursday, the recent notes from National Bank of Abu Dhabi - a $750 million issue of 3% notes due 2019 that priced at 99.731 to yield mid-swaps plus 180 basis points - were quoted at par bid, 100 1/8 offered.

On Wednesday the notes traded at 99.95 bid, 100.05 offered.

Citigroup, JPMorgan, Standard Chartered and National Bank of Abu Dhabi were the bookrunners for the Regulation S-only deal.

The issuer also priced on Wednesday an $80 million issue of 4 3/8% 20-year senior notes at par via JPMorgan in a Regulation S deal.

Saudi Arabia in focus

The 2017 notes from Saudi Electricity Co. that traded Wednesday at 103 bid, 103.50 offered were quoted Thursday at 103 bid, 103.50 offered.

The company's 2022 notes, which traded Wednesday at 109 bid, 109.50 offered, were unchanged early Thursday.

"SECO has had a very solid week and month of spread performance," a trader said.

Elsewhere in Saudi Arabia, Dar al Arkan was heavy in trading on Thursday while Sabic Capital was illiquid, he said.

Dar al Arkan's 2015 notes traded Thursday at 106.25 bid, 107.75 offered after Wednesday's close at 106.37 bid, 107.87 offered.

Sabic's 2013 notes were quoted Thursday at 103.75 bid, 104.75 offered, unchanged from Wednesday.

African bonds see action

In other trading, the $350 million issue of 7¼% notes due 2017 from Nigeria's Access Bank plc, which recently priced at par, was quoted Thursday at 99.75 bid, 100.50 offered.

On Wednesday the notes closed at 99.75 bid, 100.25 offered.

Citigroup and Goldman Sachs were the bookrunners for the Rule 144A and Regulation S deal.

Also from Africa, Tunisia's 2014 notes closed Thursday at 101.75 bid, 102.75 offered, while its 2020 notes ended the session at 95 bid, 97 offered. Egypt's 2020 bonds finished the day at 97.37 bid, 98.37 offered. The sovereign's 2040 bonds closed Thursday at 88.37 bid, 89.37 offered.

And Senegal saw its 2021 bonds end the day at 114 bid, 115 offered.

Aleesia Forni contributed to this article.

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