Daily Market Monitor: The Russian Eurobond market saw a correction on Tuesday

The Rouble bond market saw little change on Tuesday. With
moderate turnover, prices mostly remained at their previous levels. A
pause in rouble appreciation against the dollar will likely have a
negative influence on the market, while an increase in Russian
Eurobond yields could also exert downward pressure on rouble bonds
(although the latter seems the less significant factor). Should the dollar
exchange rate remain unchanged at current levels, we would expect to
see the rouble bond market consolidating or declining slightly on the
back of insignificant turnover.
Meanwhile, Russian Standard Bank successfully placed its fourth bond
issue, which clocked in at Rub 3 bln. The coupon amounted to 8.99%
for the first year that is below expectations, demonstrating that general
sentiment on the market is still favourable.
The Russian Eurobond market saw a correction on Tuesday,
which seems natural given there was no reaction to a decline in
benchmarks the day before. The Russia’30 yield increased 6bps to
6.30% (more than its benchmark UST’10 1bp yield increase to 4.37%)
while the sovereign spread widened 2 bps to 181bps. We see local
equilibrium as having been restored, leaving UST dynamics as the
main factor of influence for Russian papers again. Meanwhile another
generous helping of U.S. economic figures is due Thursday