CIMB Daily Fixed Income Commentary - 25 November 2014

Market Roundup

• US Treasuries posted little gains on softer data points from Chicago Fed National Activity Index and Services PMI, alongside a strong 2T auction. However the positive movement was rather short-lived and erased by profit taking activities ahead of the release of revised 3Q2014 GDP number. Market is expecting the third quarter GDP number to be revised lower from 3.5% to 3.3%.
• Malaysian government bonds traded in mixed directions amid lacklustre trading activities. However, GII May’24 remained popular and contributed a decent volume of RM590 million throughout the day, and closed 1bp lower at 4.12%.
• Thai govvies recovered some losses, led by some buying-on-dips activities amid improved sentiment on major economies’ dovish monetary policy stances. Meanwhile, daily volume rose from Bt14.1 to Bt19.8 billion.
• Indonesia government bond market continued to be traded amid bullish tone since last week, driven by offshore inflows. Strong bidding interest was seen in 15yr-20yr buckets on opening, and offshore inflows also came to other parts of the curve afterwards. Locals were also seen buying 3yr retail bonds (ORI11).
• Asian credits ended tighter on the back of PBoC’s surprise interest rate cut decision last Friday. Chinese names outperformed amid improved sentiment, particularly along the lower rated names. BB rated Longfor Jan’23 traded firmer at 97.85pts, in contrast to 97.41pts last week, while Agile perps climbed from 74.87pts to 75.67pts on Monday.