Asian bonds stable; Lat-Am slow; Ukraine in headlines; Petrobras could suffer downgrade

By Christine Van Dusen

Atlanta, March 27 – Bonds from Asia were stable on Friday morning, with high-grade cash bonds unchanged to 2 basis points tighter, a London-based trader said.

“Oil names remained in focus after the recovery in crude,” he said.

Malaysia’s Petroliam Nasional Bhd. (Petronas) saw its new 2025 and 2045 bonds tighten 5 bps amid support from real-money accounts, he said.

“Korea’s 10-year continued to leak wider,” he said.

The recent issue of notes from Korea’s Hyundai Capital Services – 2 5/8% notes due 2020 that priced at 99.848 to yield Treasuries plus 125 bps – continued to compress on Friday, as compared to Woori Bank.

“India’s short end remained well-bid while we saw sellers in the 10-year corporates,” he said. “High-yield sovereigns were ½ point to ¾ point lower after the rate move yesterday.”

Looking to Ukraine, sovereign bonds entered the end of the week mostly unchanged, with some better bids after an International Monetary Fund spokesperson hinted that Russia’s $3 billion holding of Ukrainian debt could be viewed as “official.” So far Russia has viewed the debt as exempt from restructuring.

Looking to Latin America, Brazil-based Petroleo Brasileiro SA (Petrobras) was at risk of losing its investment-grade rating from Fitch Ratings, according to a report from Schildershoven Finance BV.

Other Latin American names on Friday morning held in, even amid larger market volatility, a New York-based trader said.

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