EM rebounds after ‘mauling’; Ukraine bonds improve; Codelco tightens; roadshow for Georgia

By Christine Van Dusen

Atlanta, Feb. 12 – Emerging markets bonds – which on Friday morning failed to see much of a rebound amid some relief in European equity markets and oil prices – finished the week on better footing.

“The rally in crude and equities helped to bolster EM bonds, which had spreads tightening and cash prices moving higher,” a trader said.

The morning’s activity was “promising,’ a strategist said, “despite a weak performance of Asian markets.”

Many emerging markets names opened about 10 basis points tighter on Friday after the market “tanked” on Thursday, a trader said.

Bonds from Ukraine rebounded on Friday, with trading moving higher on low volumes and “aggressive Street action,” said Fyodor Bagnenko, a fixed-income trader with Dragon Capital. “Quasi-sovereigns moved higher with some decent two-way flow. Corporates remained quiet.”

Looking to Latin America, Chile’s Corporacion Nacional del Cobre de Chile (Codelco) tightened 7 bps amid light volumes while Brazil-based Petroleo Brasileiro SA and Vale SA firmed up a little bit, a New York-based trader said.

Later in the session, Latin American bonds found “a bit of stability after yesterday’s mauling, but it certainly wasn’t very convincing,” another trader said.

In deal-related news, Georgia is planning to hold a roadshow during the first half of this year for a possible issue of notes.

And Oman Telecommunications Co. SAOG is canceling plans for an issue of Islamic bonds, a market source said.

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