Primary quiet as secondary improves; Israel Chemicals, Hunt on tap; Bahrain, Oman tighter

By Rebecca Melvin

New York, May 22 – The emerging market primary was quiet on Tuesday, but the tone in the secondary improved somewhat as the U.S. dollar eased from a five-month high, according to market sources.

Oil prices moved higher amid heightened concerns regarding sanctions and supply constraints following the re-election of Venezuela president Nicolas Maduro, and U.S. Treasuries ended little changed leaving the yield on the 10-year benchmark note at 3.06%.

“Feels a little better,” a New York-based market source said, adding that there were no new pricings during the session. But a roadshow for Hunt Oil Co. of Peru LLC’s proposed offering of $600 million of 10-year notes (expected rating: //BBB) was expected to conclude on Wednesday, so pricing could occur soon, the source said.

Israel Chemicals Ltd. also continued to market its planned U.S. dollar-denominated offering of 20- to 30-year notes, and a syndicate source said the deal could price on Wednesday depending on market conditions.

Back in the secondary market, the sovereign bonds of Bahrain, Oman and Lebanon, which have been beaten down this month, “snapped back” with the retreating dollar, and they managed to end 10 basis points to 20 bps tighter on the day, while in some cases Lebanese bonds moved tighter by 30 bps to 40 bps, a London-based trader said.

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