US Treasury yields edged higher on the back of firm non-farm payrolls report, which recorded total job gains amounting to 211k in Apr (consensus 190k), while the unemployment rate further fell to 4.4% from 4.5% a mont

Market Roundup

• US Treasury yields edged higher on the back of firm non-farm payrolls report, which recorded total job gains amounting to 211k in Apr (consensus 190k), while the unemployment rate further fell to 4.4% from 4.5% a month prior. However, there was late net buying interest, sending the yields lower across the curve, possibly due to cautious stance ahead of the weekend French election. However, the Macro win should boost risk appetite this week – namely boost for EM bonds, not particularly UST.
• Malaysian govvies remained well-supported despite weaker Ringgit on Friday. Auction of the new 30-year GII saw firm demand, with a bid-to-cover ratio of 2.39 times for a tender size of RM2 billion (another RM500 million issued via private placement). Average yield was 4.895%, within a high-low spread of 4.85-4.913%, better than WI level 4.95% quoted prior the tender close. Upcoming primary supply will be new 10-year MGS, which we expect to be announced with a size of RM4.0 billion. On top of that, near term focus will be on MPC meeting scheduled for 12 May. We expects no change to the OPR. Aside, Malaysia’s exports and imports expanded by 24.1% and 39.4% yoy in Mar, beating consensus 20.0% and 28.6% respectively. Bonds were mixed after the trade numbers releases.
• Thai bond yields still fluctuated in a tight range before the NFP report. In addition, net buying position in the front of the curve and selling position in mid- and back of the curve reflected to the market began that a bond switching program may be around the corner. Yield on the bellies and long-end inched slightly higher at a less than 1bps move and 5-year LB226A yield traded up to 2.19%, close to our short-term target 2.20%. Recommend a buy when touching 2.25%.  
• IndoGBs continued its downward movement Friday; net selling mode was felt since opening, led by some sell-off on 20-year FR72. However after the break market rebounded, tone turned to more biddish as players tried to buy at lows. Volume decreased to IDR9.6 trillion and dominated by bonds maturing in over 10 years (42%).