March 8, 2018 / 8:04 AM / 12 days ago

ASIA CREDIT CLOSE: ChemChina bonds rally in constructive markets

SINGAPORE, March 8 (IFR) - “This report will be discontinued from March 15, 2018. For queries, please email” Asian credits were firm, buoyed by demand for the jumbo ChemChina trade that raised US$6.4 bln-equivalent in six tranches on Wednesday.

“The secondary market is constructive, but to be honest, it’s dominated by the ChemChina bonds,” said one trader.

Bidding was robust for the bonds from the Chinese chemical producer, which priced the notes to offer premiums of around 20bp-25bp. The 2021s priced at 182.5bp over US Treasuries, the 2025s at 220bp and the 2028s at 235bp.

In particular, the 2021s, 2023s, 2025s and 2028s pulled in between 8bp and 12bp when they were free to trade. The 2023s were quoted in early afternoon at 189bp over US Treasuries, around 13bp tighter from reoffer at 202.5bp.

The positive sentiment spilled into other recent issues as well. Hyundai Capital, for instance, saw its 3.45% 2021s tightening to 116bp from a reoffer of 121bp, based on the 2-year US Treasuries.

Asian credit spreads narrowed as Korean corporate credits continued to benefit from a potential meeting between North and South Korean leaders next month.

The iTraxx Asia ex-Japan IG index tightened 3bp to 68bp/69bp. Among Korean corporates, state-owned Kepco’s CDS pulled in 5bp to 47bp/53bp while KDB’s CDS was 4bp lower at 47bp/50bp.

Reporting by Kit Yin Boey, Editing by Vincent Baby

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