SINGAPORE, Feb 12 (IFR) - Cash bonds were flat to 1bp-2bp tighter overall, but high-beta credits were outperforming, with Huarong Asset Management’s 2025s tightening 5bp.
“Deal inventories are very light, we’re seeing net client buying, and that’s feeding into prices,” said one credit trader.
There was little activity in high yield, with renewed drama around Kaisa Group Holdings providing the only trading cue.
Just a week after white knight Sunac China Holdings agreed to buy a 49% stake and Kaisa made the delayed USD26m coupon payment on its 2020s, the latter showed that its problems were far from resolved, warning offshore bondholders that they could face a haircut as part of a restructuring.
Kaisa’s 2018s were at around 60-65 cents on the dollar this morning, and were at 54-60 this afternoon, a level which was spurring some buying interest from private banks, according to one trader. The paper had been in the 70s on Tuesday.
The Japan iTraxx was 1bp tighter at 62bp/64bp, and the iTraxx Index for both Australia and Asian investment grades were flat.