Fixed Income Daily Pulse, 8 June 2015

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

·  Post NFP data on Friday, the week started off very bearish, with bids starting at least 6 bps off last Friday’s closing bid for some of the benchmarks. This is in line with the rising treasury yields from the better than expected NFP data, fuelling speculation of a US rate hike in September this year. As street positioning was quite heavy, there is some selling off on the benchmarks, probably due to some local traders being forced to cut losses. The 7-year MGS ‘09/22 gained 17 bps today while the other benchmarks on the MGS curve gained between 6-9 bps. Traded volume overall remained light with a heavier weightage towards the short ends.  Trading volume in the GG/AAA segment remained light. Notable trade such as Prasarana Malaysia Berhad ‘03/30 and ‘11/16 traded at mix at 4.57% and 3.60%, with a collective trading volume of RM174m. Meanwhile, 1Malaysia Development Berhad ‘05/39 remained unchanged at 4.91%, with RM8m changed hands. In the AA segment, CIMB Thai Bank Public Company Limited ‘07/19 remained unchanged at 4.90%, with RM4m done. Elsewhere, YTL Power International Berhad ‘08/18 also remained unchanged at 4.25%, with only RM27m changed hands. MGS Benchmark Issues MGS Closing Level (%) Chg (bp) Vol (RM m) 3-yr 3.370 +6 40 5-yr 3.700 +6 30 7-yr 4.100 +17 80 10-yr 4.160 +9 647 15-yr 4.310 +8 90 20-yr 4.390 +7 90 30-yr 4.790 +7 1 IRS Closing Rates IRS Closing Yld (%) Chg (bp) 1-yr 3.645 -1.0 3-yr 3.760 +2.0 5-yr 4.015 +2.7 7-yr 4.215 +5.5 10-yr 4.480 +7.5 Source: Bloomberg, AmBank

               

  

Local News:

·             None.