Market Roundup
- US Treasury yield curve ended higher and steeper, amid heavier profit taking activities on the heels of stock market rebound, which was possibly due to the improved risk-on sentiment after the China’s stimulus measures. Apart from that, the UST yields were also pushed higher by strong July durable goods orders, which expanded unexpectedly at a higher pace of 2.0%, beating consensus view of -0.4%.
- Ringgit government bond yields shifter higher, after a short-lived pullback a day ago. Despite that, players were seen with better bidding interest on the front end of the curve, particularly on the papers maturing 2016-2017 in both MGS and GII segments. Elsewhere, 10-year MGS WI was last traded at 4.44%, 6bps higher than prior day close.
- Thai government bonds were dealt mixed, with heavier total transactions totalling Bt23.6 billion on Wednesday. Apart from that, the Bt7 billion LB616A reopening auction garnered decent demand, indicated by a bid-cover ratio of 2.13 times, while average yield was generated at 3.9659%.
- It was a quiet day in Indonesia government bond market with little flows seen on Wednesday. Bond prices traded down in morning session aligned with higher USD/IDR as it was traded above 14100. However the govvies recovered with strong bids seen in the market nearing closing hours. We see bond market to remain volatile amid concern on the IDR strength. Elsewhere, volume improved to IDR 13.5 trillion.
- Sentiment remained guarded in Asian dollar credit market, along with Shanghai Stock Exchange Composite Index, which headed lower by 1.2% on Wednesday, despite the PBoC’s announcement of stimulus measures a day before. Meanwhile, iTraxx ex-Japan IG Index widened by 1bp to 137bps.
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