Morning Commentary: ICBC sells $1 billion, €500 million floaters in three tranches; primary quiet

By Rebecca Melvin

New York, June 11 – Word on pricing of the Industrial and Commercial Bank of China Ltd.’s triple trancher came through after the deal for $500 million each of floating-rate notes due 2021 and 2023 and €500 million of floating-rate notes due 2021 priced last week.

The deals priced at par for yields of Libor plus 73 basis points, Libor plus 83 bps and mid-swaps plus 50 bps, respectively.

Otherwise the emerging markets debt primary was quiet early Monday with no new announcements heard.

Despite a raft of expected central bank news and other events this week such as the summit between U.S. president Donald Trump and North Korean leader Kim Jong Un in Singapore on Tuesday, which could potentially move bond markets, there are deals expected to price this week, a London-based syndicate source said.

“The market is open,” the source said.

In the broader markets, U.S. Treasury yields were higher after Italian economy minister Giovanni Tria said on Sunday that Italy’s new coalition government does not intend to leave the euro and plans to focus on cutting debt.

U.S. bonds were also factoring in more supply expected this week and the impact of the Federal Open Market Committee’s two-day policy meeting, which is widely expected to conclude with a rate hike on Wednesday.

The European Central Bank is also meeting this week and expected to announce on Thursday the conclusion of its bond purchases program after September when authorization of its bond-buying program expires. And the Bank of Japan will also be meeting on Thursday and Friday.

The yield on the 10-year benchmark note was up to 2.966% on Monday from 2.935% on Friday.

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