Wednesday April 1, 2015 Search
Weather | Athens
14o C
09o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Rally expected in new Greek bonds when trade begins

Yields on Greece's new five-year bonds, sold in the bailed-out country's return to markets after a four-year absence, were expected to fall below the sale price when they began trading on Friday.

Banks managing the sale said the bonds had already begun trading over-the-counter at yields below the 4.95 percent at which they were sold, although market participants were reserving their verdict on the deal until prices appeared on trading screens. That is expected to take place on Friday but depends on when the bonds are released to those who bought them.

Athens sold 3 billion euros of five-year bonds on Thursday, receiving massive oversubscription for its first sale of a new bond since before its bailout in 2010.

Some brokers were marking the new five-year bonds 15 basis points below the 4.95 percent yield at which it was sold, indicating the bonds would rally once secondary market trade began. Yields fall as the price of bonds rise.

One bank managing the deal said the bonds were trading at 4.90 percent. Nevertheless, brokers said there was little evidence of follow-on interest in the five-year bonds.

David Schnautz, a credit strategist at Commerzbank, said the 20 billion euros of orders for the new bonds was not a true reflection of demand, as investors were prone to inflate their orders to make sure they received a decent allocation.

"(As an investor) you have to shoot very high to get what you actually want, he said.

The Greek finance ministry said on Thursday a third of the bonds were allocated to hedge funds, investors notorious for having short-term trading strategies, leading some market participants to question why this was the case if demand was so high.

Demand for Greece's existing 10-year bonds was soft, with yields rising 6.5 basis points to 6.04 percent on Friday. Irish, Spanish and Italian equivalents all rose 1 bps to 2.92, 3.18 and 3.19 percent respectively.

Portuguese 10-year yields were unchanged on the day at 3.9 percent, refusing to rally even though Fitch raised the outlook on its BB+ rating to positive from negative, citing progress in it reducing its budget deficit.

Core eurozone government bonds also lagged on Friday, taking no impetus from a fall in overnight share prices and talk about the potential of asset purchases from the European Central Bank.

Bund futures fell even though stocks suffered a brutal session led by the worst single-day drop in the U.S. Nasdaq since late 2011.

They were last down 10 ticks at 143.79, having nudged over 144 on Thursday on expectations that a rate hike by the U.S. Federal Reserve might not come as soon as some had feared.

"Investors have already seen Bund futures rising to contract highs in the last session, and there is not much upside, said Christian Lenk, a credit strategist at DZ Bank.

[Reuters]

ekathimerini.com , Friday April 11, 2014 (13:21)  
ECB to review Greek bank liquidity after March deposit drop
Buffett says Greek exit from euro may not be a bad thing
European shares fall early; eurozone PMIs eyed
Business sentiment in decline
African envoy expresses concern over EU migrant center plans
Africa's envoy to the European Union warned Wednesday that EU plans to process migrants in the countries they leave or transit on their way to Europe are "a dangerous approach." The EU is tr...
Germany expects, at best, an interim assessment from Greece call
Germany has "modest expectations" for a conference call of euro zone deputy finance ministers this afternoon and does not expect more to come out of it than an interim assessment of Greece's...
Inside News
BASKETBALL
AEK could get a wild card to the Euroleague
AEK shows capable of climbing as high as third in the Basket League, as its 16-point home win over third-placed Aris on Sunday confirmed it can challenge both Aris and PAOK to the first spot...
SOCCER
Cyprus soccer eyes reunion after 60-year divorce
Turkish Cypriot soccer officials on Monday vowed to press ahead with attempts to reunite with the Cyprus Football Association, (CFA), triggering a political storm on the ethnically-split isl...
Inside Sports
COMMENTARY
Going his own way
While up until the last election we had become accustomed to referring to the coalition government led by Antonis Samaras as one featuring a split personality, no political psychoanalyst cou...
EDITORIAL
Righting the wrongs
A country that wants to move forward should study and deal with its past mistakes in a mature and responsible manner. Greece was hit by an unprecedented debt crisis and it came to the brink ...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
RECENT NEWS
1. African envoy expresses concern over EU migrant center plans
2. Germany expects, at best, an interim assessment from Greece call
3. Ex PM, socialist heavyweights to testify in Tsochatzopoulos trial Apr 29
4. Fifteen detained as anarchists stage protest in Parliament courtyard
5. ECB to review Greek bank liquidity after March deposit drop
6. Anastasiades welcomes Barbaros departure, urges Turkey to respect Cypruss sovereign rights
more news
Today
This Week
1. Finance Ministry officials to discuss talks progress as EU pushes for action [Update]
2. Athens aims to tighten ties with Russia
3. Going his own way
4. Greek economy minister sees deal with EU/IMF on reforms next week
5. Spike in migrants reaching Lesvos
6. Buffett says Greek exit from euro may not be a bad thing
Today
This Week
1. Next Monday is D-Day for state funds
2. Eurogroup unlikely to be held soon to discuss Greek reforms
3. Moscow expects progress from Tsipras visit
4. Some more equal than others
5. Greece to present reforms by Monday, says gov't spokesman [Update]
6. Greece optimistic on deal with euro area next week
Find us ...
... on
Twitter
... on Facebook
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright 2015, H KAΘHMEPINH All Rights Reserved.