January 10, 2018 / 8:43 AM / in 10 months

ASIA CREDIT CLOSE-Credit mixed; new issues in focus

HONG KONG, Jan 10 (IFR) - Asian credit markets were mixed on Wednesday with attention focused on new issues.

Traders said market sentiment remained constructive despite heavy supply, particularly from Chinese issuers.

“Overall the Chinese investment-grade sector was slightly wider today, led by oil names, and there was not much activity in the high-yield sector, except for new issues,” said a Hong Kong-based trader.

Chinese developer Longfor Properties, rated Baa3/BBB-/BBB, outperformed lower-rated peers.

Longfor’s 5.25-year new issue was 3bp tighter after reoffer at 168bp over US Treasuries and the 10-year tranche tightened by 8bp.

Meanwhile, Country Garden’s (Ba1/BB/BBB-) new 5-year non-call 3 notes were bid at a cash price of 99.95 after reofferat par.

Times Property Holdings’ (B1/B+/B+) new 3-year non-call 2 traded up, being bid at a cash price of 100.37, and Tahoe Group’s (B1/B/B) new dual-tranche issue was seen at around reoffer prices.

“As China is expected to continue tightening the property sector in 2018, investors are increasingly in favor of those names with strong fundamentals,” said a Hong Kong-based credit analyst.

The iTraxx Asia ex-Japan investment-grade CDS index narrowed 2bp to 59.6bp/60.5bp.

Wharf REIC’s new 10-year notes were slightly wider, being bid at 113bp over US Treasuries. (Reporting by Ina Zhou; Editing by Vincent Baby)

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