ASIA CREDIT CLOSE: Spreads narrow, volumes thin on China holidays
HONG KONG, Oct 2 (IFR) - Asian credit spreads narrowed on Wednesday as the strong risk sentiment in equities rubbed off on the debt markets, which allowed four new issuers to come to the primary market today.
The iTraxx Asia IG index tightened to 151bp today from around 158bp on Monday. Tuesday was a public holiday in Hong Kong and trading was thin.
Volumes were still low in today's trade as well, according to traders because of holidays in China.
"There are four new issues in the market today but flows are quite thin and China is on a holiday as well," said a Singapore-based trader.
Short-covering was seen in some new issues like GS Caltex 2018s which were seen at 198bp/186bp and CNOOC 2023s which were at 175bp/171bp.
Korea Western Power is marketing new 5-year bonds at T+185bp. The Korea Hydro and Nuclear Power 2018 bonds issued last week were trading around T+150bp, 10bp tighter than reoffer spread achieved then.
ICBC has released the structure of its subordinated Basel III-compliant 10-year non call five year notes without releasing a price guidance.
First Gen is in the market with 10NC5 notes at a 6.625% initial guidance for a USD200m-USD300m deal.
Finally, Swire Pacific is in the market for a new 10-year bond with a T+220bp price talk.
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