US Treasuries. UST yields inched lower along with German bund yields, as players turned slightly cautious amid global stock market declines. Aside, ADP employment registered 190k job gains in Nov, in line with market expectation. Focus will be on NFP this Friday, where consensus sees 195k for the month of Nov.
Malaysia. MYR bonds weakened after USD/MYR ticked higher from previous day low around 4.0500. Yield curve ended flatter, as selling pressure concentrated on short to medium dated papers during mid-week. The 10y reopening auction ended with disappointing result with a low btc of 1.53x and average yield at 3.946%. Post auction, it was seen trading within a wide spread of 3.89-3.98%, before closing at 3.94%. Expect sentiment to remain cautious ahead of NFP release this Friday.
Thailand. The auction of LB316A was long-tailed and the range of 2.8270-2.867% on Wed compared with 2.82% on Mon. Meanwhile, demand remained firm with 10% over allotment and 1.5x btc indicating pent-up demand from local and offshore players who looked for opportunistic buying on higher yield. Post auction, local investors further bought the bond and the yield inched lower with last traded bid yield at 2.83%. In general, bond was in bidding environment as external uncertainty from US tax bill and deadline of government shutdown on Dec 8 lowered investor's appetite for riskier asset.
Indonesia. IndoGB were traded in tight ranges on Wed. Some short squeeze in a particular 11y bond was seen in the afternoon session, and we noted some position trimming near market close, causing yield curve to go up by 1-2bps. Market volume remained high amounting IDR14.6t and was evenly distributed across the curve.
Asian Dollar Credits. USD credits closed mixed amid thin trading flows, while sentiment was slightly bearish, weighed by slump in regional stock markets. Upcoming highlight should be Friday NFP, where consensus sees job addition of 195k in Nov. Aside, Chengdu Communications' 10y bond was guided at T+245bps in primary space.
Best Regards,
CIMB Treasury & Markets Research-Fixed Income
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