Friday November 28, 2014 Search
Weather | Athens
16o C
10o 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)  
PPC profits power up in Jan-Sept
Papastratos banking on exports
Saudi group Olayan to enter Costa Navarino
Bank-financed property transactions rise a notch
Seven PASOK MPs voice support for party leader
Seven PASOK MPs on Thursday publicly backed Deputy Prime Minister Evangelos Venizelos and his plans for the party to play a leading role in a broader center-left alliance after ex-leader Geo...
New law could transfer control of unused buildings
Municipalities and private companies may soon get a chance to take over abandoned or empty buildings if a new bill drafted by the Environment Ministry is voted through Parliament. According ...
Inside News
SOCCER
PAOK is one win from Europa Leagues last 32
A late brace by Stefanos Athanasiadis gifted PAOK a precious win at Dynamo Minsk on Thursday, meaning that the Thessaloniki team is one win away from graduating from the group stage of the E...
BASKETBALL
First defeat for Olympiakos in Euroleague
Olympiakos suffered its first Euroleague loss of the season going down 89-70 at Laboral Kutxa on Thursday, although the Greek team remains the favorite to clinch the top spot in its pool. Th...
Inside Sports
COMMENTARY
The presidential election paradox
A few days ago, speaking with a visiting colleague who neither works in Europe nor covers events here, I suddenly felt how much we Greeks take for granted some things that should have worrie...
COMMENTARY
Scraping together the 180 MPs will not be enough
Even if the coalition government was to scrape together the 180-MP majority it needs to elect a new President in the 300-seat House, skeptics say, what will change really? There is one evide...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
RECENT NEWS
1. PAOK is one win from Europa Leagues last 32
2. First defeat for Olympiakos in Euroleague
3. PPC profits power up in Jan-Sept
4. Papastratos banking on exports
5. Saudi group Olayan to enter Costa Navarino
6. Bank-financed property transactions rise a notch
more news
Today
This Week
1. Greece paralyzed by major strike, flights cancelled
2. Greek diplomat dies in fall under Thai train
3. Greece scrambles to find food, shelter for 700 migrants on crippled ship
4. Chief suspect in Piraeus bar shooting arrested
5. Scraping together the 180 MPs will not be enough
6. Troika talks to continue after failure to wrap up negotiations in Paris
Today
This Week
1. Give Greece a chance
2. Scientists expand excavation of ancient Amphipolis
3. Extremism from a bygone era
4. Greece paralyzed by major strike, flights cancelled
5. Piraeus nightclub shooting leaves 3 seriously injured
6. Coscos Greek unit adds multinational rail-freight client
Find us ...
... on
Twitter
... on Facebook
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright 2014, H KAΘHMEPINH All Rights Reserved.