20230629-招银国际-Fixed_Income_Daily_Market_Update_5页_768kb

Fixed Income Asian G3 Bond Market Review Summary (29 Jun 2023)

Market Conditions

• Markets were relatively quiet due to SG holiday and ahead of half-year-end.
• Rates widened overnight by 3-7bps.
• Asian G3 bonds saw mixed activity, with Chinese financials and industrial papers showing some resilience amid high interest rates.

Trading Desk Insights

• Key Moves: DALWAN bonds down 0.5-1pt; SWIRE prices unchanged to +0.3pts; NWDEVL Perps marked down 0.25-0.5pt.
• G3 Bond Curve: Curve movements attributed to profit-taking; Chinese SOEs and TMT benchmarks mixed, with some better buying and selling flows.
• Cross-Regional: Indian and Indonesian spaces muted, with some gains in specific papers.

Corporate Actions

• DALWAN: Suspension of onshore bond issuance; application not terminated but awaits regulatory approval after addressing CSRC queries. Pre-IPO investors may resist redemption demands, with potential waiver discussions.
• SWIRE: Plans to sell Swire Coca-Cola USA unit for USD3.9bn to parent company; intends to use proceeds for dividends and debt reduction, maintaining moderate financial flexibility.

Macro and News Recap

• US Fed signals more rate hikes, with inflation not expected to fall soon.
• Treasury yields down, with 2/5/10/30yrs at ~4.71%/3.97%/3.71%/3.81%.
• Offshore Asia new issues included several bond placements and pipeline activities, with some defaults like ZYRDBG.

Other Market Developments

• LGFVs and SOE Perps largely stable amid modest recoveries.
• Cash parking flows ahead of half-year-end contributing to slow bond digestion.
• Top performers included SWIPRO and NWDEVL Perps, while underperformers saw declines in DALWAN and HILOHO papers.