Issuance from Korea Water Resources; risk appetite declines again; roadshow for Woori Bank

By Christine Van Dusen

Atlanta, Oct. 8 – Korea Water Resources Corp. sold notes on Wednesday as global risk sentiment continued to deteriorate, this time primarily in response to the International Monetary Fund’s global outlook.

The IMF has cut global growth projections for 2014 and 2015, sending most emerging markets assets wider on Wednesday, a London-based analyst said.

This – along with continued ISIS-related activity on the Syrian border – kept investors skittish during the session.

Still, the impact was limited on Syria’s neighbor, Turkey, which saw credit default swaps widen just 2 basis points, he said.

“Following the better performance after Turkey’s rating affirmation by Fitch on Friday, bond prices have largely stalled,” he said.

Meanwhile, credit default swaps spreads for Russia were 3 bps wider on Wednesday.

And demand for the new issue of bonds from Kazakhstan faded somewhat. The 10-year notes were about 20 bps wider and the 30-years about 14 bps wider from issuance, he said.

From the Middle East, trading was “another mixed bag,” a London-based trader said. “Spreads are struggling to keep pace with a U.S. Treasury bid on the back of weaker equity markets.”

South Korea’s Woori Bank has mandated Barclays, Commerzbank, Deutsche Bank, HSBC, Nomura Securities and Standard Chartered Bank to lead a roadshow starting Oct. 13, a market source said.

An issue of notes could follow.

And Romania has mandated banks for a euro-denominated issue of notes, a market source said.

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