HONG KONG, March 21 (IFR) - Asian credits stabilized a day
after the new US Federal Reserve chief shocked the market with
the possibility of earlier-the-expected rate increases.
Investors took the opportunity today to buy bonds that had
sold-off in the past few days. Stability in Asian equity markets
also gave investors some added comfort in returning to risk.
"The market is 2bp-3bp tighter with property names grinding
tighter with fast money accounts buying," said a Singapore bond
The Asia ex-Japan IG iTraxx index was quoted at about
137bp/139bp, 2bp tighter on the day as the credits underlying
the index were rolled over.
Traders reported heavy buying in Chinese property bonds,
which had been beaten down by worries over China's economy as
well as news of a loan default by a small Chinese property
Among investment grade credits, China Overseas Finance's
bonds were 10bp-15bp tighter. In high yield, Franshion
Properties' 2019s rose 25 cents to 97.63/98.38 and Country
Garden's 2021s and 2023s rose 50 cents each at 91.50/92.50 and
Credit default swaps on Chinese credits were unchanged at
101-104. CDS was 3bp tighter for Indonesia at 182/192 and 2bp
tighter for Korea and Philippines at 62-65 and 105-115,
Among new deals, IDBI 2019s traded about 330bp tighter over
US Treasuries after pricing at 350bp over on Wednesday.
High yield bonds from Indonesia were 0.25-0.375 points
higher on the day but traders said expectations of supply
weighed on this sector.
Traders said they expected the market to remain choppy in
the near term with buying on positive news and exaggerated
selling on negative headlines.