Kazakhstan bonds' prices grow due to external demand

/REUTERS, Almaty, Oljas Auezov, February 17, 03/ - Prices of the most liquid Kazakhstan government and corporate bonds increased last week despite the continued decreasing of dollar's rate relative to tenge and, as the result, absence of demand from outside of main domestic investors - pension funds, traders say, explaining the growth as foreign investors' activity. "Last week our corporate securities rose in price very much", - said a trader of a domestic pension assets management company (PAMC). "(The market) is moved mainly by foreign investors", - noted a dealer of bank CenterCredit. According to traders' words, because of tenge strengthening pension funds do not want to invest in dollar or non-indexed to the rate of tenge/dollar securities, preferring the National Bank's short-term notes. "This is interesting only for those who have currency obligations", - said the dealer of bank CenterCredit, having explained that the point was domestic banks and foreign investors. The latter demonstrate high demand for Kazakhstan securities, which is proved by results of primary floatation (in Luxemburg) and following growth of quotations of eurobonds of Canadian oil company Hurricane, assets of which are concentrated in Kazkhstan. "Demand for (eurobonds) Hurricane was great, it exceeded offer tree times as much", - said dealer of domestic PAMC. "Kazakhstan corporate bonds have increased after good news from Russia - decision about purchasing of TNC Hurricane increased only on account of these news", - dealer of bank CenterCredit believes. In the nearest future, in traders; opinion, liquid bonds will go on growing in price. "Prices may grow stably", - the traders of domestic PAMC is sure. The growth, excluding external factors, can be promoted by coming back of pension funds to eurobonds market in case exchange rate becomes stable. "Uncertainty at the money market disturbs many potential purchasers, - dealer of bank CenterCredit believes. - I think they (pension funds) are expecting the bottom on dollar". Consultant of USAID Stiven Moody, who spoke on Friday at the congress of financiers in Alma-Ata, also forecasted growth of prices. "Corproate bonds' yield may be decreasing", - he said. "Excessive liquidity appeared (at Kazakhstan market), because you are afraid of low level of foreign securities' yield," - Moody believes. "Have no fear", - the consultant advised in the end. [2003-02-17]