FW: RHB FIC Credit Markets Weekly - 27/11/17

 

 

 

27 November 2017

Credit Markets Weekly

Malaysia's Oct Inflation Moderates; US Tax Reform Plans Watched

SUMMARY:

¨      MYR Credit Market: Malaysia's October inflation rate lowered to 3.7% YoY and was below the forecasted rate of 4.1%; Malaysia's foreign reserves for the period of 15-Nov17 remained unchanged from the 31-Oct17 period, at USD101.5bn; Benchmarks 3y-10y MGS saw yields tightening across the curve between -16bps and -7bps with the shorter end of the curve outpacing the longer end of the curve; The MYR traded +1.07% higher against the greenback WoW to end at 4.1163/USD; Strong trading activities in the govvies space with weekly volume of MYR19.7bn, marginally above the 3-month weekly average of MYR12.8bn; In the credit trading space, trading activities remained weak as volume declined to just under MYR1.4bn WoW.

Corporate News – RAM has reaffirmed Impian Ekspresi Sdn Bhd's 10y programme guaranteed by Danajamin Nasional Berhad and 7y programme guaranteed by Malayan Banking Berhad, at AAA/Sta; MARC has affirmed the AAA/Sta rating on TRIplc Ventures Sdn Bhd (TVSB); MARC reaffirmed AAAIS rating on Gas District Cooling (Putrajaya) Sdn Bhd (GDC Putrajaya); RAM assigns AA-/Sta to Medini Iskandar Malaysia Sdn Bhd (MIMSB)'s proposed MYR1.5bn sukuk murabahah programme.

¨      APAC USD Credit Market: Shorter trading week saw USTs mixed but continue to flatten

¨      Rating Actions - Moody's upgrades Vedanta Resources PLC bonds to B2/Sta from B3/Sta; Moody's revises Doosan Bobcat Inc to Ba3/Sta from B1/Sta; S&P upgrades Powerlong Real Estate to B+/Sta from B/Sta; Fitch upgrades the rating of AIA Group Limited (AIA) to AA-/Sta from A+/Sta; Fitch upgrades the rating of AIA Group Limited (AIA) to AA-/Sta from A+/Sta; S&P lifted the Creditwatch negative on China Hongqiao Group Ltd (Hongqiao) affirming it at B-/Sta; Fitch has downgraded ratings on Sime Darby Berhad to BB+/Sta from BBB+/Sta; Fitch has also assigned BBB+/Sta on Sime Darby Plantation Berhad (SDP); S&P downgraded rating of Korea Resources Corp (KORES) to A/Sta from A+/Sta; Moody's assigns B1/Sta to BlueFocus Communications Group Co Ltd; Moody's assigns A2/Sta on ICBC International; S&P assigns BB+/Sta to PT Jasa Marga Persero Tbk (JM)

 

 

 

 

 

 

 

 

 

 

Table 1: Index Weekly Movements

Indices	24-Nov	17-Nov	Weekly Chg (bps)
iTraxx AxJ 5y IG	75.9	79.6	-4
AxJ IG Spread (bps)	161.3	161.4	0
AxJ HY (%)	6.71	6.73	-2
SOR 2y (%)	1.44	1.46	-2
SOR 5y (%)	1.83	1.88	-5
Malaysia 5y CDS	65.6	69.1	-4
MGS 3y (%)	3.37	3.54	-16
MGS 5y (%)	3.61	3.76	-15
MGS 7y (%)	3.87	3.98	-11
MGS 10y (%)	3.91	3.98	-7
AAA 5y Spread* (bps)	73	59	14
AAA 10y Spread* (bps)	76	73	3
AA 5y Spread* (bps)	104	93	12
AA 10y Spread* (bps)	111	110	1

Source: Bloomberg, BNM, RHBFIC        *MYR-denominated bonds

 

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