20230106-招银国际-Fixed_Income_Daily_Market_Update_7页

报告摘要

CMBI Credit Commentary Summary

Core Content Overview

This document provides a detailed market update and analysis for the fixed income market in Asia, with a focus on China, as well as highlights key macroeconomic news and analyst recommendations. It includes insights from the trading desk, market performance data, and outlook for 2023 in the Asia credit space.

Market Performance

Fixed Income Market: The market was initially upbeat, with new issue HKAA bonds tightening by several basis points. However, profit-taking occurred around noon. Active traded LGFV and SOE names with yields above 6% saw strong demand.
China Credit Space: The China IG space remained firm with strong cash deployment needs. Financials were tighter by 2-3bps due to active two-way flows. Bank names such as BOCHKL, CMHI, and CNBG were under better buying.
T2 Benchmarks: CCBs tightened by 3-6bps.
TMTs: Relatively stable after a Wednesday rally, with BABATENCNT and BIDU/XIAOMI tightening by 2-4bps.
Properties: IG properties like LNGFORs rose 1.5-2.5pts, and CHJMAO 4.875 Perp reached 90 level. China HY had a strong session with SINOCEs and COGARDs rising.
Underperformers: PCGIHD, CHJMAO 6 Perp, BTSDF, ZHHFGR, and ZHLGHD were among the top underperformers, with price declines ranging from -1.5 to -4.0pts.

Macro News Recap

U.S. Markets: U.S. stock markets were weak, with S&P (-1.16%), Dow (-1.02%), and Nasdaq (-1.47%) down due to strong Dec ADP data of 235k, exceeding expectations. This raised concerns about inflation and further rate hikes.
U.S. Treasury Yields: Short-term yields edged up, while long-term yields fell. The 2/5/10/30 yields curves reached 4.45%/3.90%/3.71%/3.78%, respectively.
CMBI Research Outlook: A mild U.S. recession is expected to start in Q2 2023, and the U.S. rate hikes are likely to moderate, supporting EMs.

Asia Credit Outlook 2023

2022 Performance: ACIG and ACHY returned -12.3% and -19.9%, respectively. Asian HY corps underperformed other EMs, while Asian IG corps outperformed.
New Issuance: Gross issuance in Asia ex JP fell 52% in 2022 to USD165.1bn, the lowest since 2014. Net issuance was negative USD105.2bn, marking the first negative net issuance year since 2008.
Valuation and Fund Flows: Current valuations are seen as having a sufficient margin of safety. Fund flows have turned more favorable, and the U.S. rate hike sensitivity and global economic outlook remain key factors.

Key Recommendations

AMC (Asset Management Companies)

HRINTH 4.25 PERP
HRINTH 5.5'25
CCAMCL 4.4 PERP
CCAMCL 4.375'25
GRWALL 3.95 PERP

AT1s (Additional Tier 1 Bonds)

BCHINA 3.6 PERP
ICBCAS 3.58 PERP
DBSSP 3.3 PERP
UOBSP 3.875 PERP
SHINFN 5.875 PERP
KBANK 5.275 PERP
KTBTB 4.4 PERP

Car Rentals

CARINC (preferred despite higher cash price due to more resilient performance)
EHICAR

China Properties

CHJMAO, CSCHCN, DALWAN, GRNCH, HPDLF, LNGFOR, SEAZEN, VNKRLE, YLLGSP

Corp Perps

NWSZF 5.75 PERP
NWDEVVL 6.15 PERP
PCORPM 4.6 PERP
UPLLIN 5.25 PERP

LGFVs (Local Government Financing Vehicles)

SHUGRP 4.3'23
HKIQCL 3.99'23
HZCONI 3.15'23
YWSOAO 3.15'23

Macau Gaming

MPELs and STCITYs are preferred, with lower conviction due to recent strong performance.

SE Asia Commodities and Renewables

GRNKEN, INDYIJ 8.25'25, SAKAEI 4.45'24, VEDLNs (especially short-dated and secured ones)

TMTs (Technology, Media, Telecommunications)

PDD 0'25
XIAOMI 0'27

New Issues (Priced)

Asian Development Bank:
- USD3,500mn, 3yr, 4.25%, SOFR MS+29, Aaa/AAA/AAA
- USD2,000mn, 10yr, 4.0%, SOFR MS+60, Aaa/AAA/AAA
Airport Authority (HKAA):
- USD500mn, 3yr, 4.875%, T+70, -/AA+/-
- USD1,000mn, 5yr, 4.75%, T+90, -/AA+/-
- USD700mn, 7yr, 4.875%, T+115, -/AA+/-
- USD800mn, 10yr, 4.875%, T+125, -/AA+/-

New Issues (Pipeline)

Chengdu Sino French Ecological Park Investment Development Woori Bank:
- USD, 3yr, 6.5%
- USD, 3/5yr, -

China Property Support Measures

Chinese authorities have extended measures to support the real estate sector by easing mortgage rates. Cities can lower or drop the minimum mortgage rate for first home purchases if new home prices fall for three consecutive months (MoM and YoY).
As of the latest data, 38 out of 70 cities met the criteria to lower or drop the minimum mortgage rate.
Top developers in selected tier 2 cities (by contract sales in 11M22) are recommended, including Poly Development, Dalian Wanda, Vanke, and others.

Important Disclosures

CMBIGM or its affiliates have investment banking relationships with the issuers covered in this report.
The report is not an offer or solicitation to buy/sell securities.
There may be conflicts of interest due to CMBIGM's involvement in the securities market.
The report is intended solely for major U.S. institutional investors and may not be distributed to others.
The report is distributed in Singapore by CMBISG, an exempt financial adviser, and is subject to Singapore law.
The report is for the use of intended recipients only and must not be reproduced or distributed without consent.

Disclaimer

CMBIGM or its affiliates have investment banking relationships with the issuers in the report.
The report is not intended for distribution to individuals outside the defined categories.
The information is based on publicly available data and is not guaranteed for accuracy or completeness.
The report is provided for informational purposes only and does not constitute investment advice.

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