Emerging markets firmer; new Codelco tranches tighten; Promsvyazbank, PTTEP price deals

By Rebecca Melvin

New York, July 26 – Emerging markets were firmer on Wednesday as buyers stepped back into the market ahead of news on the latest rate-setting decision by the U.S. Federal Reserve and following some selling into Fed decision day on Tuesday, a market source said.

“It’s constructive,” the source said of market tone on Wednesday. “There was a little bit of selling yesterday, as it seems the market got a little bit ahead of itself, but we’ve seen buyers of EM throughout the day today,” the source said.

Corporacion Nacional del Cobre de Chile (Codelco)’s new tranches improved in first-day trading after the Santiago-based state-owned copper mining company priced $2.75 billion of the senior notes at yields that were tighter than initial talk, sources said.

Codelco’s new 4½% notes due 2047, of which $1.25 billion were priced on Tuesday, were quoted at a spread of Treasuries plus 167 basis points bid, Treasuries plus 164 bps offered, compared to the initial price of Treasuries plus 175 bps.

The Codelco 3 5/8% notes due 2027, of which $1.5 billion were priced, were quoted at 146 bps bid, 143 bps offered, compared to initial pricing at Treasuries plus 150 bps.

Also in primary action, Russia’s Promsvyazbank priced €500 million perpetual notes at par to yield 8¾%, or mid-swaps plus 680.7 bps, and Thailand’s PTTEP Treasury Center Co. Ltd., a subsidiary of PTT Exploration & Production PCL, priced $354 million of perpetual notes at par, sources said.

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