Morning Commentary: EM debt firmer; Gazprom to price dollar deal; Pemex notes eyed

By Rebecca Melvin

New York, Jan. 31 – The emerging markets debt market was trading well on Thursday with names that have lagged of late regaining some ground, market sources said.

A London-based trader said the international bonds of the Middle East and Africa region were solid, “with higher beta names doing very well.”

Emerging markets investors were cheered by the U.S. Federal Reserve’s message on Wednesday that it will be patient regarding monetary policy and further rate raises. The U.S. dollar lagged on the news while global stocks and emerging markets bonds strengthened.

On Thursday, Russia’s PJSC Gazprom announced that it is planning to issue dollar-denominated notes, and mandated banks and scheduled roadshow meetings to market the deal.

Gazprombank and JPMorgan are joint global coordinators and bookrunners of the notes deal, and Banca IMI, Credit Agricole, Mizuho Securities, Renaissance Capital, SMBC Nikko and VTB Capital are joint lead managers and bookrunners.

Meetings for the Moscow-based natural gas producer’s proposed notes are set to start in the United States on Monday.

The actively trading 2027 notes of Petroleos Mexicanos SAB de CV improved after a setback on Tuesday and Wednesday after Fitch Ratings downgraded the state-owned oil company’s debt by two levels to BBB-, citing a lack of investment being committed to reverse declining production.

The downgrade leaves the company’s rating at the lowest investment-grade level, and market sources are beginning to speculate that the company will not be coming to the international bond market for issuance in the next few weeks as had been expected.

The Pemex 6˝% notes due 2027 were trading somewhat better at around 97 on Thursday after sinking to the 94 range this week.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.