March 24, 2014 / 9:57 AM / in 4 years

ASIA CREDIT CLOSE: Chinese property bonds up on PB buying

SINGAPORE, March 24 (IFR) - Chinese property bonds traded up today, despite a lower-than-expected China March Flash PMI.

China’s March flash PMI fell to 48.1, compared with the consensus estimate of 48.7, indicating industrial activity contracted further in March. ‘The PMI has more of an effect on the currency market than on the bonds,” a bond trader said.

High-yield property names were up about 1 point, in general, on buying interest from private banks and short covering of hedge funds. Evergrande Real Estate’s 2015s were indicated at 103/104, while its 2018s were around 93/93.5, both up about 25 cents. KWG Properties and Kaisa Group also drew attention.

PBs were also keen on industrial names, such as Fufeng Group, Liansu Group and MIE Holdings. Those were the names that were not sold off quite as much in the last few weeks, traders said. However, as they are more closely held, any buying interest can lift prices.

China Fishery held an investor call today to announce the completion of its USD650m refinancing loan, as well as the termination of its long-term supply contract with its Russian partner. However, the announcement failed to move its bonds. The 2019s still hovered around par.

Meanwhile, Shui On Land concluded a non-deal roadshow in Singapore today. The management said the company would refinance its due-2015 bonds in June this year, according to a source, who attended the roadshow.

In South-East Asia, Olam bonds continued to rise on the back of the Temasek offer to buy out the company. Its 2018s were indicated at 104/104.5, compared with low-90s before the offer.

Trading among investment-grade names was quiet today with the Asia ex-Japan IG iTraxx index quoted at 132bp/134.2bp, tighter than Friday.

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