EM debt extends gains post Fed; Gazprom, Eldorado, BTG Pactual join calendar; Pemex eyed

By Rebecca Melvin

New York, Jan. 31 – The emerging markets debt market continued to rally on Thursday extending gains notched on Wednesday. More deals joined the primary calendar, but no new deals priced in Latin America or the Central & Eastern Europe Middle East and Africa regions, 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.”

Later a New York-based source suggested the rally may be overdone at this point.

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.

For Latin America, Eldorado Brasil Celulose SA and Cellulose Eldorado Austria GmbH plan to price a dollar benchmark of intermediate duration notes.

Brazil’s Banco BTG Pactual SA also has selected banks and scheduled fixed-income investor meetings for an offering of tier 2 10-year, non-call five, subordinated notes, according to syndicate source.

In secondary market dealings, the actively trading 2027 notes of Petroleos Mexicanos SAB de CV improved after a setback on Tuesday and Wednesday.

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