BUSINESS

New Greek bond slumps as equities remain volatile

TAGS: Markets

Greece’s new 3-billion-euro seven-year bond was down over three points in cash price terms on Friday after further equity market volatility, leaving investors nursing heavy paper losses.

The 3.375 percent trade – the lowest coupon on an outstanding Greek sovereign bond – was bid late morning at 96.16, down from the 99.236 reoffer.

That gives a 4.015 percent yield, according to Tradeweb prices, sharply higher than the 3.5 percent print.

Marketing had started at 3.75 percent area but talk was tightened on the back of a 6-billion-euro plus book.

Greece is due to exit its third bailout program in August and has been keen to show renewed market access.

This was its longest trade since returning from a three-year exile last year.

“We had a very tough close on Thursday night and it will take a bit of time for the market to settle down,” a lead banker said.

“Also, the liquidity difference between Greece and other peripherals is pretty marked and the moves are a little more than in other markets, which can absorb flows in a way Greece can’t.”

[IFR]

Online