Morning commentary: Mexico, Oman, Slovenia begin marketing new deals amid strong secondary

By Rebecca Melvin

New York, Jan. 3 – The emerging primary market kicked off the new year with deal offerings announced on Wednesday by Mexico, Oman and Slovenia as well as Banco del Estado de Chile, according to market sources.

The new deals were getting underway against a backdrop of strength in the secondary market, a London-based trader said. In the Middle East and Africa region, there has been “relentless demand for the most part” over the first two trading days of the year.

The Oman sovereign curve was called just 1 to 3.5 basis points wider with a triple-tranche offering of five-, 10- and 30-year notes starting to roadshow.

Oman’s 2022 notes were seen last at 100.625 and at a z-spread of 147 bps, the Oman 2027 notes traded last 100.875 at a spread of 286 bps, and the Oman 2047 notes were last bid at par at 396 bps, the trader said.

Meanwhile Lebanon was very strong and called 10 bps to 20 bps tighter depending on the tenor.

The new bond offerings should see decent demand given the secondary market tone, the trader said.

Mexico is offering new dollar-denominated notes due 2028 at initial price talk of Treasuries plus 160 bps area and a tap of its 4.6% 2048 notes at Treasuries plus 205 bps.

Pricing of the Mexican tranches via BBVA Securities Inc., J.P. Morgan Securities LLC and BofA Merrill Lynch as joint lead underwriters was expected late Wednesday.

Banco Estado de Chile was marketing via bookrunners BofA Merrill Lynch, Citigroup, HSBC, and J.P. Morgan but further details were not immediately available.

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