Fixed Income Daily Pulse, 20 July 2015

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

·        With many traders still away on Raya holidays, the week started off in a quiet manner with very little trading in the market during the morning session. Post lunch, the market took a bullish turn when there was a buying flow on the 10-year MGS, with the bond being taken as low as 3.96% (-7 bps from last closing) and c.RM500 million traded. Subsequently, there was also some minor buying interest on the belly of both MGS & GII curve as well. Spread of 10-year GII against MGS widened by 3.5 bps today to 13.6 bps (3m mean c.10bps). One thing to take note as well today, there was a few big tickets done on the MGS ‘08/15 and MGS ‘03/17 with RM3 billion and RM2.6 billion done respectively. Trading activity was light in the GG/AAA segment. Bank Pembangunan Malaysia Berhad ‘09/21, declined 1 bp to 4.12% with RM20 million traded. Meanwhile, Danalnfra Nasional Berhad ‘07/24 declined 1 bp as well to close at 4.30% with RM5 million changed hands. In the AA segment, Public Bank Berhad ‘08/17 increased 3 bps to settle higher at 4.75% with RM2 million done. Meanwhile, OCBC Bank (Malaysia) Berhad ‘08/17 increased 5 bps to close higher at 4.35% with RM10 million traded. MGS Benchmark Issues MGS Closing Level (%) Chg (bp) Vol (RM m) 3-yr 3.235 -2.5 1084 5-yr 3.550 -3.5 25 7-yr 3.845 -3.0 30 10-yr 3.960 -7.0 450 15-yr 4.210 -1.0 60 20-yr 4.320 0.0 0 30-yr 4.690 -3.0 60 IRS Closing Rates IRS Closing Yld (%) Chg (bp) 1-yr 3.695 0.0 3-yr 3.760 0.0 5-yr 3.960 -0.5 7-yr 4.135 0.0 10-yr 4.348 -0.2 Source: Bloomberg, AmBank                      Source: BondStream, AmBank

               

  

Local News:

·             None.