February 8, 2018 / 8:14 AM / 4 months ago

ASIA CREDIT CLOSE: Daegu outperforms in muted market

SINGAPORE, Feb 8 (IFR) - Asian credits were broadly unchanged in a lacklustre market, where some two-way trades were done at prices in narrow ranges.

“The market is stable and it is not quiet, but just that prices are largely flat,” said one trader.

Daegu Bank took advantage of a slight improvement in market sentiment yesterday to price a US$300m 5.5-year bond due 2023 at 135bp over US Treasuries.

A lack of primary supplies in the investment-grade segment led to a good bidding tone for the South Korean bank credit, tightening the notes to 117bp/116bp.

However, two other issuers in the market yesterday saw their bonds marginally drop in secondary markets.

The trader said he did not make an effort to trade in the bonds of both Shangrao Investment and Fujian Zhanglong Group due to illiquidity on the back of the small issue sizes.

Shangrao’s US$200m 5.7% 2021s were nominally indicated at 97.8/98.3 against reoffer at 98.116, while Zhanglong’s US$300m 5.6% 2021s were seen at 98.9/99.4 against reoffer at 99.32.

Country Garden’s recently issued 4.75% 2023s were at a bid of 98.9, flat to yesterday, despite a 42% year-on-year growth in contracted sales for January.

Asian credit spreads were flat with the iTraxx Asia ex-Japan investment-grade index quoted at 71bp/72bp.

Reporting by Kit Yin Boey; Editing by Dharsan Singh

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