ASIA CREDIT CLOSE: China property a tad wider, sovereigns range-bound

Fri Jun 27, 2014 5:54am EDT

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HONG KONG, June 27 (IFR) - Asian credit markets were mixed as traders said investors were locking in gains in investment-grade credits, while sovereign bonds were range-bound amid a tightening in US Treasury yields.

Greenland Holding Group's USD1bn Reg S senior dual-tranche bonds that priced Wednesday were trading at wider spreads as the market closed, with the USD400m 4.375% 5-year bonds cited at spreads of 300bp/296bp and the USD600m 5.875% 10-years trading at 352bp/349bp.

The bonds from the Chinese property developer widened spreads throughout the sector by about 5bp, according to a Singapore-based trader.

"We're seeing a lack of liquidity today and people are taking profit as there isn't a strong conviction at these levels," according to another bond trader.

Malaysia's AmBank, which priced a Reg S-only USD400m 5-year to yield 150bp over US Treasuries overnight, saw its bonds give up some gains. The spreads moved to 137bp this afternoon following a 20bp tightening this morning from real-money demand.

Indonesia's sovereign bonds mostly were unchanged from yesterday. The Indonesia 2044s were last seen on a cash basis of 115.5 from 115.0 yesterday, while the 2024s were hovering near yesterday's 110.50.

Sovereign bonds from the Philippines were trading an eighth of a point higher on a cash price basis amid a rally in US Treasury yields. The US 10-year was yielding 2.53%, its lowest level the tightest level since May 30.

Traders said liquidity may be tight because a holiday in Hong Kong on July 1. The US also will be off for its July 4 holiday next week.

Frances.yoon@thomsonreuters.com

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