ASIA CREDIT CLOSE: Asian credits put up mixed showing amid busy primary market

Wed May 7, 2014 5:43am EDT

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HONG KONG, May 7 (IFR) - Asian credits were generally weak today as major stock markets in the region plunged in response to the lower-than-expected China PMI data. The Hang Seng Index lost over 230 points, or around 1.05%, today.

The market stabilised somewhat after CNPC announced a dual-tranche offering of bonds at tenors of 3 and 5 years, while investors had expected the inclusion of a 10-year piece. Overall, the bonds from the oil companies remained on a soft note, except that there were no serious selloffs.

With the primary markets returning to full swing in Hong Kong/Tokyo after yesterday's holiday, some profit taking was noted in a bid to make room for new issues.

China property bonds remained under pressures in both the IG and HY segments, ahead of expected large supply later this year.

Small-sized property developer Jingrui is testing the HY sector with a 13.625% yield and 35-cent private-banking concession for a 5-year non-call 3 issue, while Country Garden is expected to hit the market tomorrow.

Country Garden's 2021s weakened to around 92.64 from 93 yesterday. Wanda 2018s were a tad firmer at 97.925/97.801 today from 97.801 yesterday.

Evergrande's 2018s dropped to 89/90 today from 90.55 yesterday, while Kaisa's 2018s were down more than 100 cents to 97.75/97.787.

Recently priced Lenovo 2019 gave some grounds to 261bp over US Treasuries, from a strong 250bp over last month. Meanwhile, State Grid 2019s held on to 117bp over, though its 2024 widened 3bp to 150bp over US Treasuries.

Elsewhere, Indonesian bonds remained well bid. Its sovereign 2044s were quoted at 114.25/114.71 this afternoon from 113.75 yesterday. The Philippines' 2034s tightened slightly to 127.375/127.625 from 126.5 mid-price yesterday.

nethelie.wong@thomsonreuters.com

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