Fixed Income Daily Pulse, 24 April 2015

The day’s trade recap (from our trading desk):

·         Market started the week rather tamely but activity quickly picked up in the middle of the week as a decently large offshore order in the 10-year MGS started the ball rolling. Yields subsequently eased between 2.5 to 6.5 bps as the week closed on strong buying from both local and foreign players with the 5-year being the outperformer on the curve (-6.5 bps). GIIs however lagged that of its MGS counterpart as the spread widened to between 9-11 bps along the curve as there was much less interest in the GIIs. Offshores continue to put on carry trades as we saw them buying short end GIIs in large sizes on cheap implied funding as well as to take advantage on the MYR appreciation. Over the GG/AAA segment, PTPTN ‘03/24 and ‘02/30 traded 3 and 4 bps lower to 4.29% and 4.60% respectively, with RM110m changed hands. Elsewhere in the AA segment, notable trade saw in the FI industries are RHB Bank ‘04/20, which the yields traded 3 bps lower to 4.83% with a trading volume of RM50m.    MGS Benchmark Issues MGS Closing Level (%) Chg (bp) Vol (RM m) 3-yr 3.290 -1.0 312 5-yr 3.580 -3.0 601 7-yr 3.740 -1.0 375 10-yr 3.840 -1.0 285 15-yr 4.060 +1.5 4 20-yr 4.180 0.0 1 30-yr 4.560 - - IRS Closing Rates IRS Closing Yld (%) Chg 1-yr 3.610 -1.5 3-yr 3.630 -2.0 5-yr 3.770 -1.5 7-yr 3.940 -2.0 10-yr 4.085 -3.5

               

  

Local News:

·           None.