HONG KONG, Dec 8 (IFR) - Asian credit markets continued
their surprising rally, even though US Federal Reserve meetings
and a widely expected interest rate increase are only days away.
The iTraxx Asia ex-Japan investment-grade was spotted over
3bp tighter at 116.00/118.00, approaching its pre-US election
Asian CDS surged to nearly 136.00 in the days after November
8. Prices have been volatile, but have been on a steadily
tightening trend in the last three weeks.
Although traders expressed some surprise over the market
sentiment, they said impressive trade figures out of China were
"I was surprised to see this today," said a Singapore-based
IG bonds trader. "Nobody seems to care about the Fed, so this
rally has been unexpected. At the same time, though, volumes
haven't been huge and liquidity doesn't feel great."
The rally was strongly felt in the sovereign segment, with
Indonesian spreads about 8bp tighter. Philippines 2041 bonds
were over a point higher according to Tradeweb.
Some recent high-yield issuers also enjoyed a constructive
session. Studio City's 2021 US dollar bonds were up almost half
a point and being bid at 105.125 after issuing two weeks ago at
Primary markets also fed off the more bullish tone as
Chinese issuers marketed three US dollar deals.
Syndicate bankers suggested that there was some hurry to get
deals done before the end of the year, as many investors have
already stopped buying new issues.
(Reporting by Spencer Anderson; editing by Dharsan Singh)