January 12, 2018 / 8:47 AM / 6 days ago

ASIA CREDIT CLOSE: Asian credits firm; new issues trade up

HONG KONG, Jan 12 (IFR) - Asian credits were firm on Friday with new issues rallying despite heavy primary supply.

Tencent’s jumbo US$5bn four-tranche bond was one of the market focuses today with its new 5-year bonds trading 2bp tighter, the 10-year bonds 7bp tighter and the 20-year bonds 6bp tighter.

The Chinese internet giant priced a US$1bn 2.985% 5-year fixed-rate tranche at Treasuries plus 65bp and a US$500m floater at Libor plus 60.5bp.

A 3.595% US$2.5bn 10-year fixed-rate note priced at Treasuries plus 105bp, and a 3.925% US$1bn 20-year at Treasuries plus 105bp.

“Market sentiment was good and we continue to see inflow into credits,” said a Hong Kong-based trader.

The trader said investment-grade names, in general, were about 1bp-2bp tighter. He spotted buying into some Chinese bank AT1s such as those of China Construction Bank and Postal Savings Bank of China.

The iTraxx Asia ex-Japan IG index was 2bp tighter to 60.0bp/60.9bp.

Other new issues priced last night also traded well. State-owned Power Construction Corp of China’s US$500m 4.25% senior perpetuals rose 0.15 point to a bid of 100.15.

Philippine oil refiner Petron’s US$500m 4.6% senior perpetuals also rose 0.15 point to a bid of 100.15.

High-yield bonds also gained.

Yingde Gases’ newly priced US$500m 6.25% 5-year non-call 3 bonds were bid at 100.25, versus reoffer price of 99.788 or a reoffer yield of 6.30%.

Chinese property developer Golden Wheel Tiandi’s US$200m 7.00% 3-year bonds were bid at 99.75, versus reoffer price of 99.337 or reoffer yield of 7.25%.

Reporting by Carol Chan; Editing by Vincent Baby

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