EM just had the busiest day of the year on the bond market

Emerging markets poured into the debt market yesterday with a flurry of bond issuances, as sovereigns look to capitalize on what is “an opportunistic time” for debt markets as interest rates dip this month, Bloomberg reports. Yields on 10-year US Treasuries are down more than 10 basis points this month, with markets expecting the US Federal Reserve to start winding down its monetary tightening sooner rather than later after May figures showed US inflation beginning to cool. “Now is the calm before further external factors come into play,” Oren Barack, managing director of fixed income at New York-based Alliance Global Partners, tells the business information service.

Who’s tapping the market: Four countries — the UAE, the Dominican Republic, Indonesia, and South Korea — all tapped the market yesterday, making it “one of 2024’s busiest days.” The UAE sold USD 1.5 bn worth of eurobonds in its first sale since September, setting the spread at 60 basis points above US Treasuries amid red-hot demand, according to Bloomberg. The country had initially guided on a spread of 90 bps above Treasuries.

EM debt markets already came out the gate strong at the start of 2024, with the first four days of the year seeing USD 24.4 bn worth of issuances, making it the “busiest start to a year on record for USD- and EUR- denominated debt issuance out of developing nations,” the business information service said at the time. The momentum has been sustained in the months since, with some USD 300 bn of hard currency debt from EM sovereign and corporate issuers going to market year-to-date, rising c.30% y-o-y.

MARKETS THIS MORNING-

Asian markets are mixed in early trading this morning, with the ASX 200, Hang Seng, and Shanghai Composite all in the red and the Kospi and Nikkei both in the green. US stock futures are largely unchanged in overnight trading after the S&P 500 and Nasdaq Composite each ended three-day losing streaks yesterday. Futures point to a mixed open in Europe later this morning.

THE CLOSING BELL: TADAWUL-

The TASI rose 0.3% yesterday on turnover of SAR 7.1 bn. The index is down 2.0% YTD.

In the green: Al Rajhi Takaful (+9.0%), Bupa Arabia (+7.0%) and Sisco Holding (+5.5%).

In the red: Ades (-2.8%), Miahona (-2.6%) and Qacco (-2.4%).

THE CLOSING BELL: NOMU-

The NomuC fell 1.3% yesterday on turnover of SAR 84.1 mn. The index is up 7.7% YTD.

In the green: Saudi Top (+17.5%), Neft Alsharq (+14.4%) and Burgerizzr (+5.8%).

In the red: Keir (-7.9%), Al Rasheed (-7.3%) and Future (-6.8%)

CORPORATE ACTIONS-

Shareholders of Nomu-listed Saudi Networkers Services Co. have approved the board’s recommendation of a dividend of SAR 14.1 mn at SAR 2.35 per share for 2H 2023, according to a disclosure to Tadawul. The distribution date is set for Sunday, 7 July.

Shareholders of Nomu-listed Nofoth Food Products have approved the board’s recommendation to distribute SAR 9.6 mn in dividend at SAR 0.2 for FY 2023, according to a regulatory filing (pdf). The distribution date was set for Tuesday, 16 July.

Shareholders of Tadawul-listed Saudi Steel Pipe have approved the board’s recommendation of a dividend of SAR 37.5 mn at SAR 0.74 per share for FY 2023, according to a regulatory filing (pdf). Eligible shareholders will be able to cash in starting Sunday, 7 July.

Shareholders of Tadawul-listed Astra Industrial Group have approved the board’s recommendation to distribute SAR 200 mn in dividend at SAR 2.5 for FY 2023, according to a regulatory filing (pdf). The distribution date was set for Sunday, 30 June.

The board of Nomu-listed Saudi Summit Trading has recommended a dividend of SAR 7.2 mn at SAR 0.6 a piece for 2H 2023, it said in a disclosure to Tadawul.