Ukraine

Ukrainian energy company DTEK is struggling to halt a slide in its bond trading since the National Anti-Corruption Bureau of Ukraine (NABU) issued notices of suspicion to six individuals — two of whom are DTEK employees — involved in a coal pricing controversy. The bonds have lost around five points in the space of a week.

Ukraine’s GDP warrants are trading around a cash price of 85. That is way below JP Morgan's view that fair value is closer to 135. No matter the new, surprisingly positive GDP growth forecasts and enthusiasm for the country’s new leadership, from the trading numbers it seems clear that investors do not believe they will get their money from Ukraine.

Ukraine’s government bonds rallied ferociously this week after a decisive victory for president Volodymyr Zelensky’s Servant of the People party in Sunday’s parliamentary elections. As the end of the week approached, investors started to question how much further the buying could run and what the fate of the country’s GDP warrants will be.

The Servant of the People party was victorious in Ukraine’s parliamentary elections on Sunday. The move cements the new president Volodymyr Zelensky’s control and should allow him to pursue the reforms mandated by the IMF.

Naftogaz hit screens on Friday to print three year dollars and five year euros, making it to market a day later than expected.

Naftogaz had been expected to hit the market for euros on Thursday, but leads said a busy schedule of investor calls led leads to move the deal to Friday and to consider adding a tranche of dollar funding.

Ukraine Railways has benefited from investors' desperation for yield, with a sharp tightening in pricing from initial price thoughts.

Ukrainian Railways is returning to the Eurobond market for the first time in six years, hitting screens with a five year $500m global bond.

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Ukraine set the terms on its €1bn seven year bond on Thursday afternoon, taking advantage of a huge bid for CEE euro sovereign deals this week and a rally in the country’s own debt since president Volodymyr Zelensky was elected at the end of April.

Ukraine has released initial price guidance for a euro deal that the country has been waiting to print since before Volodymyr Zelensky’s presidential victory in April.

Ukraine has mandated banks for a seven year euro-denominated benchmark bond, with the sovereign due to meet investors after a sharp rally in its bonds.