India's Icici does deal on slow summer Tuesday; Qatar, Poland bonds stand out in trading

By Christine Van Dusen

Atlanta, Aug. 14 - India's Icici Bank priced notes on Tuesday as investors reacted only minimally to better-than-expected economic data from Greece, France and Germany.

"After the relative scarcity of economic news after the U.S. payrolls data, today the European morning session has been dominated by economic releases," Barclays Capital said in a report. "The news led to only a modest market reaction but that does not disguise the fact that euro zone growth matters enormously for global financial markets and for debt sustainability."

Against this backdrop, liquidity was thin on Tuesday.

"These are the dog days of summer," a New York-based trader said. "There's very little going on in terms of flows, inquiries and new issues."

In trading, the recent $2 billion issue of 2.099% notes due 2018 from Qatar funding vehicle SoQ Sukuk that priced at par was seen at 100.37 bid, 100.50 offered after Monday's levels of 100.50 bid, 100.65 offered.

The second tranche of that deal - $2 billion 3.241% notes due 2023 that also priced at par - was quoted at 102 bid, 102.50 offered after being seen Monday at 102.55 bid, 102.80 offered.

Barwa Bank, Deutsche Bank, HSBC, QInvest and Standard Chartered Bank were the bookrunners for the Regulation S deal.

In its new deal, lender Icici Bank sold $750 million 4.7% notes due 2018 at 99.813 to yield Treasuries plus 400 basis points.

Bank of America Merrill Lynch, Citigroup, HSBC, JPMorgan and Standard Chartered were the bookrunners for the Rule 144A and Regulation S deal.

Investec, Tunisia see trading

From South Africa, financial company Investec Ltd.'s 3 7/8% notes due 2017 were trading Tuesday at 97 bid, 98 offered after buyers were seen Monday at the high-97 level.

The notes priced at 99.775 to yield Treasuries plus 310 bps on July 16 via HSBC, ING, Investec, RBS and Standard Chartered Bank in a Regulation S deal.

Tunisia's 2013 notes traded Tuesday at 101.62 bid, 102.62 offered, unchanged from Monday. The sovereign's 2020 notes - which ended Monday at 95 bid, 97 offered - were quoted at 94 bid, 96 offered on Tuesday.

Africa in focus

Also from Africa, Egypt's 2020 bonds ended Tuesday unchanged at 97.37 bid, 98.37 offered. The sovereign's 2040 bonds were also unchanged at 88 bid, 89 offered.

And Senegal saw its 2021 bonds trade on Tuesday at 114.50 bid, 115.50 offered. On Monday the notes closed at 113.87 bid, 114.87 offered.

In other trading, bonds from Central and Eastern Europe have seen mixed performance so far this week, according to a report from Erste Group Research. Eurobonds from Poland have stood out among others in the region, particularly on the long end of the curve.

Fund flows 'solid'

So far this month, inflows into emerging markets bond funds have been solid, according to Nick Chamie, head of emerging markets research for RBC Capital Markets.

"EM portfolio capital inflows had a good start to August with solid inflows in all countries tracked across both local fixed income and equity markets," he said. "High-yielders Turkey and Brazil in particular saw sizable rebounds in foreign inflows in early August."

Risk appetite seemed solid at the start of the month, he said.

"EM fund inflow data also reported healthy interest by investors to add EM exposure," he said. "Bond fund flows reported an improvement in local-currency bond fund interest."

Aleesia Forni contributed to this report.

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