Issuance from Peru; Bahrain advances deal; oil prices fall on Iran comments; Lat-Am widens

By Christine Van Dusen

Atlanta, Feb. 23 – Peru sold new notes on Tuesday as oil prices fell on the news that Iran criticized the proposal by Russia, Saudi Arabia, Qatar and Venezuela to cap oil production at January levels.

Meanwhile, sovereign debt spreads for Latin America widened on the day, with Brazil’s five-year credit default swaps spreads closing at 467 basis points from 460 bps and Mexico’s finishing at 199 bps from 194 bps.

“Cash prices remain firm, and in some cases higher, as markets navigate intraday Treasury volatility combined with spread widening,” a New York-based trader said. “Latin American high yield is lower on the day, with Venezuela and Argentina weaker.”

Corporate bonds from Latin America saw better buyers, and Brazil-based Vale SA moved higher, another trader said.

Bahrain on Tuesday launched $600 million of taps of its notes due in 2021 and 2026 and set talk after canceling the deal last week, a market source said.

In other deal-related news, Singapore-based investment company Temasek Holding Ltd. is looking to price euro-denominated and benchmark-sized bonds due in six and 12 years.

Iraq has revived plans to issue dollar-denominated notes this year, and could print as much as $2 billion of bonds (expected rating: Caa1) during the second half of 2016, a market source said.

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