Notes from Turkey, China's ICBC price; sentiment unfazed by U.S. shutdown; spreads flat

By Christine Van Dusen

Atlanta, Oct. 3 - Turkey and Industrial and Commercial Bank of China Ltd. sold notes on Thursday as spreads barely wiggled and sentiment remained firm for emerging markets debt, even as the U.S. government's partial shutdown continued.

"Markets are trading in a zigzag manner with the U.S. shutdown dragging the U.S. dollar to an eight-month low while equities have refrained from such a move on expectations that central banks might remain in super-loose mode for longer," a London-based analyst said.

Still, sentiment for emerging markets assets improved slightly on Thursday following better economic data from China.

"In Central and emerging Europe, the Middle East and Asia, markets remain in wait-and-see mode," she said.

The Markit iTraxx SovX CEEME ex-EU index spread on Thursday opened at 244 basis points, just 1 bp tighter than Wednesday. The Markit iTraxx Crossover index spread - seen Wednesday at 399 bps - moved 1 bp wider on Thursday.

The recent issue of notes from Abu Dhabi-based Al Hilal Bank - $500 million of 3.267% notes due 2018 that priced at par - moved to 101 bid, 101.15 offered on Thursday.

On Wednesday the notes were quoted at 101.11 bid, 101.23 offered.

And Saudi Arabia-based Saudi Basic Industries Corp.'s (Sabic) recent $1 billion 2 5/8% five-year notes traded at 99.20 bid, 99.35 offered on Thursday after pricing at 99.559.

On Wednesday the notes were seen at 99.25 bid, 99.375 offered.

Meanwhile, South Korea's SK Broadband Co. Ltd., China Petrochemical & Chemical Corp. (Sinopec Group), Russia's Home Credit and Finance Bank, Singapore's Midas Holdings Ltd., China Properties Group Ltd. and Russia's OJSC Gazprom advanced deals.

Perpetuals mostly flat

Abu Dhabi Islamic Bank's perpetual notes were spotted Thursday at 99.5 bid, 100.5 offered, unchanged from Wednesday.

The notes priced at par.

Dubai Islamic Bank's perpetual bonds, which also priced at par, traded Thursday at 95.37 bid, 96.12 offered.

The notes were seen Wednesday at 99.5 bid, 95.875 offered.

Gabon in focus

In other trading on Thursday, Gabon's 8½% notes due in 2017 received some attention.

The sovereign bonds traded in the 114 to 115 range for most of the session, a trader said.

"That's 35 bps tighter on the day," he said, adding it was a "cheeky move."

New deal from Turkey

Turkey priced a $1.25 billion issue of Islamic bonds due in 2018 (expected ratings: Baa3//BBB-) to yield mid-swaps plus 300 bps, a market source said.

HSBC, QInvest and Standard Chartered Bank are the bookrunners for the Rule 144A and Regulation S deal.

Other details were not immediately available on Thursday.

ICBC prices notes

China's ICBC priced $500 million 4½% 10-year notes at 99.903 to yield 4.522%, or Treasuries plus 315 bps, a market source said.

ICBC, ANZ, BofA Merrill Lynch, Citigroup, Credit Agricole, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, RBS and UBS were the bookrunners for the Regulation S deal.

The notes were talked at a spread in the 320 bps area.

The bank is based in Beijing.

Roadshow for SK Broadband

South Korea's telecommunications company SK Broadband will set out on Oct. 7 for a roadshow to market a dollar-denominated offering of notes, a market source said.

Barclays, Deutsche Bank and HSBC are arranging the marketing trip.

A Regulation S deal is expected to follow.

Sinopec plans marketing trip

Beijing-based chemical company Sinopec Group has mandated Citigroup, JPMorgan, HSBC, Societe Generale and Goldman Sachs as bookrunners for a dollar- or euro-denominated offering of notes and a roadshow, a market source said.

The marketing trip will take place in Europe and conference calls will be held in Asia and the United States.

The notes will be issued by Sinopec Group Overseas Development (2013) Ltd.

Home Credit to market notes

Russia-based Home Credit and Finance Bank will set out on a roadshow for an offering of dollar-denominated notes on Oct. 7, a market source said.

Citigroup, Sberbank and UBS are the bookrunners for the Rule 144A and Regulation S deal.

The roadshow will be held in the United States, London and Europe.

The lender is based in Moscow.

Midas sets roadshow

Singapore-based manufacturer Midas Holdings will set out on Oct. 7 for a roadshow to market a possible offering of notes, a market source said.

The company previously announced the establishment of a S$500 million multicurrency medium-term note program with DBS Bank and HSBC.

Proceeds will be used for general corporate purposes, including refinancing existing borrowings and financing acquisitions, investments and working capital and capital expenditure requirements.

The roadshow will take place in Hong Kong and Singapore.

China Properties eyed

China Properties Group will hold investor meetings starting Friday for a possible issue of notes, a market source said.

BofA Merrill Lynch is leading the meetings.

China Properties is a Hong Kong-based real estate developer focusing on large-scale residential and commercial project in China's major cities.

Gazprom ponders issuance

Russia's Gazprom has mandated BNP Paribas, Gazprombank and UBS as bookrunners for a possible issue of Swiss franc-denominated notes, a market source said.

A roadshow for the Regulation S deal will begin on Oct. 14.

Gazprom is a Moscow-based natural gas producer.

Barbados postpones offering

The Government of Barbados has postponed a maximum $500 million offering of notes due in October 2025, the proceeds of which were to be used to fund a tender offer, a market source said.

The sovereign had planned to purchase up to $250 million of its 7¼% notes due Dec. 15, 2021 and 7% notes due Aug. 4, 2022.

According to a press release, any notes that have been tendered will not be purchased.

The new note offering - a Rule 144A and Regulation S issue with bookrunner Deutsche Bank - was talked at a yield in the 8¾% area.

Korean deal oversubscribed

Korea Western Power Co. Ltd.'s new $500 million 2 7/8% notes due Oct. 10, 2018 that priced at 99.304 drew a final book of more than $2.25 billion from 207 accounts, a market source said.

The notes came to the market at a yield of 3.026%, or Treasuries plus 165 bps.

BNP Paribas, Citigroup, RBS and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

About 48% of the orders came from Asia, 35% from the United States and 17% from Europe.

Fund managers picked up 43%, central banks and sovereign wealth funds 23%, banks 15%, insurers 14% and private banks and others 5%.

OGX lower

Among distressed names, OGX Petroleo e Gas Participacoes SA bonds were softening and one trader said the company's dollar denominated issues were now trading flat after the company missed a coupon payment on the 2022 maturity earlier in the week.

The company's 8½% notes due 2018 fell almost 3½ points to 12.

The trader also saw the 8 3/8% notes due 2022 declining over 2 points to close around 133/4.

The trader remarked that both issues were trading flat, or without accrued interest, after the Brazilian oil producer failed to make a $44.5 million coupon on its 2022 maturity.

The missed coupon had been expected by the market.

But the company was in the news again on Thursday, as it said that its Tubarao Martelo oilfield had about 87.9 million barrels of oil product - a figure that was less than a third of what the company had originally forecast.

The area is the company's only producing field.

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