Fixed Income Daily Pulse, 11 June 2015

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

·  Activity in the local bond market had been subdued today after a few days of action. Yields along the MGS curve were pretty flat apart from the belly of the curve which inched up 1 to 2 bps. Albeit the quietness, we saw some 2-way price action on the 10-year MGS in the afternoon, suspecting foreign yield hunters buying the bond. Total traded volume for the 10-year MGS was RM300m while other benchmarks traded were below RM150m.Prasarana Malaysia Berhad ‘11/16 and ‘03/20 increased 1-10 bps to settle at 3.61% and 4.03%, with a collective trading volume of RM145m. Meanwhile, Suria KLCC Sdn Bhd ‘12/24 increased 2 bps settled at 4.42%, with RM30m changed hands. In the AA segment, Hong Leong Bank Berhad ‘06/19 eased 6 bps to settle at 4.28%, with RM10m done. Elsewhere, CIMB Bank Berhad ‘12/15 increased 23 bps settled at 4.28%, with only RM1m changed hands. MGS Benchmark Issues MGS Closing Level (%) Chg (bp) Vol (RM m) 3-yr 3.360 0 3 5-yr 3.710 +1 4 7-yr 4.070 +1 1 10-yr 4.150 +2 14 15-yr 4.280 +1 1 20-yr 4.350 - - 30-yr 4.760 0 2 IRS Closing Rates IRS Closing Yld (%) Chg (bp) 1-yr 3.645 -0.5 3-yr 3.745 0.0 5-yr 4.005 0.0 7-yr 4.190 -2.0 10-yr 4.468 +0.8 Source: Bloomberg, AmBank

               

  

Local News:

·    Malaysia’s industrial production rose by 4.0 percent y/y in April, slower than economist’s

       expectations of a 4.5 percent rise. The slowdown was due to weak performances by all three

               sectors.

·    Manufacturing Sales Value shows a -0.6% compare to previous 4.4%. Manufacturing and

        electricity output decreased by 1.0 percent each in April, and mining output fell by 1.9 percent.