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Price consolidation in debt markets yesterday. Comments: MMK, FGC UES

27/11/2012 | UFS IC
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Bond market
• Yesterday local sovereign debt market posted marginal growth amid decreased trading volumes.
• Corporate bond market showed mostly mixed dynamics.

Money market
• Yesterday tension in the money market aggravated. Today we expect rates to stay at current levels. Tomorrow the banking system is paying the last tax this month—corporate tax, which will keep up market tension.

Comments
• MMK (Ва3/-/ВВ+) is going to sell 10-year bonds of Series 18 worth 5 billion rubles. The issue can be attractive form the middle of the yield guidance—9.2% per annum, which suggest a premium to OFZ from 240 b. p.
• Yesterday Moody’s downgraded FGC (Ваа3/ВВВ/-) by one notch to Ваа3 with the outlook Stable. We do not anticipate Moody’s downgrade to lead to bond price revision.

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