CIMB Daily Fixed Income Commentary - 14 April 2015

Good Morning,

Market Roundup

• US Treasury posted little gains on Monday, recovered some from last week losses. Players were seen staying at the sidelines ahead of several key economic indicator releases this week, after seeing the split in FOMC on the rate hike timing.
• MGS yield curve ended flatter, driven by selective buying interest along the curve. Daily transaction fell further to RM2.4 billion, from RM3.0 billion registered last Friday, while dominated by GII papers. At this juncture, we saw better sellers in GII segment, possibly due to profit taking activities after the recent yield compression. Meanwhile, WI for the new 5-year MGS was last traded at 3.62%, about 2bps higher from last Friday level.
• Market closed on Songkran Festival Day.
• Indonesia government bond market mostly traded in range with softer tendency ahead of today's bond auction. Newly issued Sukuk retail bond (SR07) is tradable in the market after finished its 1-month holding period, and dominated market transactions, accounted for 47% of total trades today (IDR 14.7 trillion total). MoF will be holding IDR bond auction today, series auctioned will be 9-month SPN bills, 5-year FR69 and 15-year FR71 benchmark bonds.
• Asian credits dealt mixed amid thin flows, while market focus was on Noble and Kaisa bonds on Monday. Noble Jan’20 headed lower by 0.57pt to 102.10pts, while Kaisa Mar’18 rallied by more than 7pts to 72.00pts and 71.19pts respectively following the surprise return of former chairman Kwok Ying-shing.