HONG KONG, April 21 (IFR) - Asian credit markets traded on a constructive note on Friday as new issues rallied on a boost to overall risk sentiment from Wall Street’s solid performance overnight on strong corporates earnings.
Caution remained, nevertheless, ahead of Sunday’s French presidential election.
Trades were mostly focused on the newly issued bonds of China Huarong AMC and Want Want China, as spreads of other investment-grade credits generally were only 3bp-5bp tighter, according to a Hong Kong-based trader.
The iTraxx Asia investment-grade index was indicated at 99bp/100bp, less than 1bp tighter than Thursday’s level.
“Huarong’s notes were well bid, especially the floaters, where we saw big support from bank treasuries,” the trader said.
The state-owned distressed debt manager’s US$2.97bn five-tranche US dollar bonds drew final orders of more than US$13.7bn at final pricing.
Huarong’s 3-year floaters traded 30bp tighter and 5-year floaters were 25bp tighter from the reoffer levels, according to the trader.
Its 5-year and 10-year fixed-rate notes traded around 15bp tighter, while its 30-year fixed-rate notes were bid at 5.375%, tighter than reoffer yield of 5.50%.
Want Want’s newly priced US$500m 5-year US dollar bonds also traded up, with the spread 11bp-12bp tighter.
In the high-yield segment, China SCE Property’s 5.875% 2022s were quoted at a cash price of 99.413/99.888, according to Tradeweb.
The property developer sold an additional US$300m bonds at 99.471 to yield 6% on Thursday.
Reporting by Carol Chan; editing by Dharsan Singh