SINGAPORE, March 9 (IFR) - Asian financial markets weakened
as sentiment turned cautious ahead of the US Federal Reserve
meeting next week.
Equities fell in the region with the Hang Seng Index down
1.2% and the Shanghai composite down 0.74%.
Asian credit spreads were 3bp wider. The iTraxx Asia
investment-grade index was seen at 97bp/99bp in the morning, and
stayed broadly unchanged for the rest of the day.
Among the sovereigns, Indonesia's five-year CDS pushed out
the most at 6bp-7bp during the day. It was last seen at
An expected outflow of funds, due to expected hikes in US
Fed rates, caused a wobble in Indonesia's long-dated bonds. The
sovereign's 2047s dipped 1.25 points to 103 in cash price,
while, in terms of spreads, the notes were 2bp-3bp wider.
"The market is rather soggy after the strong US ADP data was
released," said one trader. "The reasoning is that rates can
spike for the rest of the year."
The ADP employment report showed a 298,000 net increase in
private-sector jobs last month, 111,000 more than projected.
The weak market sentiment hit new issues. Malaysian lender
CIMB's newly printed 3.623% 2022s widened to 124bp/121bp after
having priced yesterday at 115bp.
Chexim's new bonds were also under pressure. Its 2.625%
2022s were quoted at 88bp/87bp, slightly out from reoffer spread
of 85bp. The 3.375% 2027s were indicated at 115bp/114bp, wider
than the reoffer spread of 110bp.
In the high-yield segment, diminishing demand continued to
weigh on Noble's new 2022s, with a call in 2020. The notes sank
to 97.00/97.642 from reoffer at par, and down from yesterday's
(Reporting by Kit Yin Boey; editing by Dharsan Singh)