SINGAPORE, June 22 (IFR) - Chinese high-yield property bonds gapped out 5bp-10bp despite a strong pushback from Dalian Wanda Group against rumours that Chinese banks had ordered the sale of its bonds.
Wanda said the rumours were “malicious speculation” and that banks had not issued such notices.
Nevertheless, the market swirled with more rumours, said a trader.
“There were rumours that CBRC (the Chinese banking regulator) had asked banks for some Chinese companies’ loan details, causing the property bonds to widen,” said one high-yield trader.
Bonds from Wanda Group sank as much as 11 points in the morning to 100.75 while Fosun’s 2022s have slipped to 96.9/97.85.
The negative impact dragged newly priced bonds from Evergrande down by 3 points in the afternoon.
In contrast, investment-grade credits were stable to slightly wider.
“It’s rather quiet as the market seems focused on new issues and upcoming ones from Kaisa and Jinmao, which are both in the market today,” said an IG trader.
China Reinsurance’s 3.375% 2022s bucked the trend, tightening to 190bp/187bp over Treasuries after the issuer did a US$700m tap yesterday at 195bp.
Reporting by Kit Yin Boey; Editing by Vincent Baby