September 25, 2017 / 9:29 AM / a year ago

ASIA CREDIT CLOSE: Fund inflows target new issues for yield pick-up

SINGAPORE, Sept 25 (IFR) - Asian credit was little affected by a further flow of aggressive statements from the U.S. President on North Korea, with traders patiently picking up bonds that dipped.

“Things are supported, they are just not going anywhere in a hurry,” said a credit trader. “Inflows are still coming in, but markets are fixated on new issues where they can find an extra bit of yield.”

The Korean sovereign five-year CDS contract was seen at around 72bp today, equivalent to 67bp on the old contract, said a credit trader, meaning that it was still below recent highs.

Market participants rolled to a new on-the-run contract on September 20.

The Asia ex-Japan iTraxx investment grade index was 1bp wider today, at 72bp/73bp.

Postal Savings Bank of China’s Additional Tier 1 notes were quoted at a cash price of 99.7 today, up nearly half a point since Friday but still below the issue price of par.

Sinopec’s 2022s were flat at Treasuries plus 89bp, while China Great Wall Asset Management’s 2022s tightened 2bp to Treasuries plus 136bp.

Ayala’s fixed-for-life perpetual bonds jumped a quarter of a point today to a cash price of 102.1, yielding around 4.6%. Another recent Philippine issue, BDO Unibank’s 2023 bonds, tightened 1bp to Treasuries plus 115bp.

Reporting by Daniel Stanton; Editing by Vincent Baby

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