20231206-招银国际-Fixed_Income_Daily_Market_Update_4页_753kb

Fixed Income Credit Commentary Summary (Dec 6, 2023)

Market Overview

The report covers key developments in fixed-income markets:

• Asian investment-grade (IG) bonds showed balanced two-way flows, with selling pressure on short-end names and buying interest in the belly and long-end names. China's LGFV/SOE perpetuals remained stable with light flows.

• Yield spreads and prices varied across regions: VEDLN spreads rose slightly to 175 basis points in Asia due to a USD 12 billion loan agreement that lowers near-term default risk. In India, corporate papers performed well.

• Trading desk comments highlight SOE perpetual papers showing better bids at the long end, with stability in financial AMCs/leasing sectors. Property markets remain sluggish, driven by yuan-term-out solicitations and low demand.

New Issues and Pipeline

• Recent new issues include Offshore Asia placements, such as Taizhou Huaxin Pharma's bond and AVIC International Leasing's guaranteed perps.

News Recap and Market Data

• Global indices were mixed on Tuesday, with US PMI at 50.8% and Eurozone PMI higher than expected. US Treasury yields retreated, with 2-year/5-year/10-year/30-year yields around 4.57%/4.14%/4.18%/4.30%.

Analyst Comments

• Focus on Vedanta Resources' USD 12 billion loan to repay maturing bonds, which reduces short-term refinancing risks but leaves high pressure from upcoming debt maturities. Bond prices and yields for VEDLN series are detailed, with plans for bondholder discussions and potential divestment.

Risk and Disclosures

The report includes author certification and important disclosures, noting potential conflicts of interest and risks in trading securities. CMBIGM advises independent evaluation and professional advice.