UPDATE 1-Spain 30-yr bond draws over 28 bln euros in orders so far, manager says
(Adds new demand, quote, details)
LONDON, Feb 25 (Reuters) – Spain opened the sale of a new 30-year government bond on Tuesday and attracted more than 28 billion euros ($30.4 billion) in orders, according to a lead manager — healthy demand, but short of mid-January’s record order book for a 10-year bond.
Spain’s 10 billion-euro deal on Jan. 13 attracted the largest-ever order book for any new debt sale in the euro zone.
The sovereign expects to price the new deal later on Tuesday, the lead manager said.
The final spread on the new bond was 86 basis points above the mid-swap level, down from the initial guidance of 89 bps, lead managers said in a note seen by Reuters.
Demand for the new bond appeared to ignore current bearish sentiment in the bond markets, where risk aversion linked to the coronavirus weighed on peripheral issuers, according to Lyn Graham-Taylor, a rates strategist at Rabobank in London.
“This deal is a good opportunity to buy Spanish bonds in a big size and that’s what the orders reflects,” he said.
Worries about the spread of coronavirus and the impact on Europe has hurt southern European bond markets this week, especially Italy. The closely watched gap between Spanish and German 10-year bond yields on Tuesday widened to 73 basis points , the widest in more than two months.
Barclays, BBVA, BNP Paribas, CACIB, J.P. Morgan and Santander are the lead managers on the deal. ($1 = 0.9223 euros) (Reporting by Dhara Ranasinghe, writing by Emma Pinedo, editing by Larry King)
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