EM ASIA DEBT-Spreads narrow on U.S. stock gains, data

HONG KONG, June 1 (Reuters) - Asian bond spreads narrowed
on Monday, as gains in U.S. stocks and encouraging economic
data lifted demand for the region's debt and shares.

Wall Street investors cheered a report on Friday that U.S.
consumer confidence rose to an eight-month high in May, the
latest sign that that the worst downturn in decades in Asia's
top export market may be abating. [ID:nN29439922]

"Money continues to pour in Asian bond markets. U.S.
equities did very well on Friday and that boosted confidence in
Asian markets this morning," said a Singapore-based analyst.

Unlike safe-haven U.S. or Japanese government debt, most
Asian bonds are seen as riskier assets that benefit from
improved risk appetite.

The Asia Itraxx investment-grade index <0#ITAIGMPBMK=>
excluding Japan narrowed to 175/185 basis points (bps) from
180/195 on Friday, a Hong Kong-based trader said. The index,
which measures 50 high-credit bond spreads in Asia, stayed at
its narrowest level in eight months.

The market largely ignored reports that General Motors
would file for a bankruptcy on Monday, traders said.
[ID:nN31495007]

"It's not really a surprise. That's been widely expected,"
a trader said.

The MSCI index of Asia-Pacific stocks outside Japan
.MIAPJ0000PUS was up 1.6 percent as of 0327 GMT.

The following were the major movers in cash bonds and
credit default swaps (CDS):

-- PHILIPPINES' cash bonds rose. The country's 8.375
percent bond due in 2019 718286BE6= was trading at
116.50/116.875, up from 115.75/116.125, while the nation's
five-year CDS PHILP5UA=GFI was flat at 210/220 bps.

Investors also found comfort in a senior government
official's assurances that Manila has no current plans to issue
bonds overseas. He clarified comments from a central banker on
Friday that the state may sell up to $1 billion worth of debt
in the fourth quarter. [ID:nMAN428611]

-- SOUTH KOREA's five-year CDS KOREA5UA=GFI narrowed to
150/160 bps from 165/185, tracking gains in the broader market,
traders said. But threats of attacks from North Korea and an
expected string of new issues from local firms capped gains.

North Korea could this month test-fire a long-range missile
designed to strike U.S. territory and may also be gearing up
for skirmishes with the South around their disputed sea border,
local news reports said on Monday. [ID:nSEO112904]

-- CHINA's five-year CDS CHINA5UA=GFI were steady at
80/90 bps as investors are waiting for the outcome of U.S.
Treasury Secretary Timothy Geithner's two-day visit in Beijing,
traders said. Geithner is expected to reassure China, the
biggest single holder of U.S. Treasuries, that Washington will
move swiftly to get its debt under control. [ID:nSP461636]

LATEST MAJOR RATINGS ACTIVITY IN ASIA (EXCLUDING JAPAN)
>Fitch affirms Telekom Malaysia's rtgs at A-minuus
[ID:nWLA5412] >Fitch comments on Korean Devt Bank
privatisation
[ID:nWLA5416]

FIVE-YEAR CREDIT DEFAULT SWAPS

Bid/Ask spread

Current Week ago
Korea Dev Bank 214/05* 220.00*
Hutchison 120/140 120/140
PCCW-HKT 185.00* 205.00*
China 80/~ ~/100
Indonesia 315/~ 300/330
Korea 150/165 130/158
Malaysia 105/120 100/128
Philippines ~/233 215/~
~ no bid or ask
For CDS prices double click on GFICDS
*midspread
ASIAN BENCHMARK DOLLAR BONDS

Coupon Maturity Bid price Bid spread

5-YEAR

------

DBS Bank 7.13 15-May-11 106.79 115

Malaysia 7.50 15-Jul-11 109.61 45

ICICI Bank 5.75 12-Jan-12 97.50 444

Petronas 7.00 22-May-12 109.92 111

Hutchison 6.50 13-Feb-13 104.67 274

Chartered Semi 6.25 4-Apr-13 83.24 943

Korea 4.25 1-Jun-13 98.02 244

United Overseas 4.50 2-Jul-13 99.00 241

PCCW-HKT 6.00 15-Jul-13 90.80 632

China 4.75 29-Oct-13 107.33 61

10-YEAR

-------

Hutchison 7.45 24-Nov-33 97.00 423

Korea 4.88 22-Sep-14 98.69 166

PCCW-HKT 5.25 20-Jul-15 88.15 421

Woori Bank 6.13 3-May-16 89.00 478

Penerbangan 5.63 15-Mar-16 99.13 228

Philippines 8.75 7-Oct-16 115.50 260

Indonesia 6.88 9-Mar-17 95.50 416

ICICI Bank 6.38 30-Apr-22 74.35 536

Petronas 7.88 22-May-22 113.50 284

(Reporting by Jun Ebias; Editing by Tomasz Janowski)