August 4, 2014 / 8:47 AM / in 3 years

ASIA CREDIT CLOSE: Indonesia sovereign up 2 points on stabilized treasuries

SINGAPORE, August 4 (IFR) - Indonesian sovereign bonds was an outperformer in an otherwise quiet trading day in Asia.

Long-end Indonesian sovereign cash bonds rallied 1.5 points on the back of stabilized Treasuries. After a shocking jump to 2.56% last week, Treasuries were stable at 2.49% today.

Last Friday’s worse-than-expected non-farm payroll numbers also gave investors some comfort that the Fed will not change its stance towards interest rates policies in the near future.

Long-end Philippine sovereign paper also rose 75 cents today.

“Sentiment is better this week with no major data point. We expect credits to grind tighter,” a Singapore-based trader said.

Asia ex-Japan IG iTraxx index tightened 2bp-3bp today with investment grade cash bonds generally flat on light two-way trades.

Light primary pipeline is also likely to support sentiment in the secondary. Export-Import Bank of Korea is the only major deal bankers expect for the week.

Indian credits were weak on the news that Syndicate Bank’s chairman was arrested on bribery charges. Syndicate Bank’s 2019s widened by 15bp to 243bp-238bp over UST. ICICI bank’s 2019s also weakened by 7bp-8bp to 200bp-195bp.

In contrast, Chinese senior bank paper continued to attract buying interest, another Singapore-based trader said.

In the high-yield segment, Jingrui Holdings’ USD150m bonds issued last Friday rose 50 cents to be indicated in the 99-handle on retail demand. But there was very little liquidity as the paper was mostly purchased by anchors.

KWG Property’s new 2019s continue to see two-way trading with cash price rising to 100/100.75. Meanwhile, Redco’s 2019s weakened a tag to mid-99/100.

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