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CREDIT UPDATE: Asia Credit Spreads Tighten On China Stimulus

CREDIT UPDATE
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  • Asian stocks rallied on Thursday, driven by renewed enthusiasm in the tech sector after strong revenue forecasts from Micron. The weakened yen further boosted Japanese stocks, while Chinese equities have surged as the government introduced new stimulus measures, including one-off cash handouts for the poor ahead of the National Day holidays. Investors are optimistic about China's commitment to support the economy, including reports of a potential $142 billion capital injection into state banks. The risk-on sentiment across Asian markets follows the Fed’s recent rate cut, and traders are now focused on the potential for more direct stimulus measures from China.
  • Very little to mention in the Aussie market today, there were some small SSA taps but that looks to be all with focus turning to the ABS & RMBS. In secondary spread are little changed, there has been some decent two-way flow as some accounts look to take profit on some of the new issues, while Aussie banks head into year-end and look to lighten up on their balance sheets.
  • In Asia today the focus has all been on China, equities have surged higher with property leading the way with major equity benchmarks up +7%. Asia IG spreads are anywhere from 1-5bps tighter, moves have largely tracked those in equities, Financials are underperforming the moves, while O&G names have seen some late weakness following Oil selling off. Gaming names are 1-2pts higher, Property is anywhere from 1-10pts higher.
  • Aus iTraxx CDS is unch at 64bps & while Asia Ex-J iTraxx is 1bp lower at 69.50bps
  • Headlines: China Weighs Injecting $142 Billion of Capital Into Top Banks
  • Primary: Qatar National Bank $300m 5Y Formosa SOFR+115
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  • Asian stocks rallied on Thursday, driven by renewed enthusiasm in the tech sector after strong revenue forecasts from Micron. The weakened yen further boosted Japanese stocks, while Chinese equities have surged as the government introduced new stimulus measures, including one-off cash handouts for the poor ahead of the National Day holidays. Investors are optimistic about China's commitment to support the economy, including reports of a potential $142 billion capital injection into state banks. The risk-on sentiment across Asian markets follows the Fed’s recent rate cut, and traders are now focused on the potential for more direct stimulus measures from China.
  • Very little to mention in the Aussie market today, there were some small SSA taps but that looks to be all with focus turning to the ABS & RMBS. In secondary spread are little changed, there has been some decent two-way flow as some accounts look to take profit on some of the new issues, while Aussie banks head into year-end and look to lighten up on their balance sheets.
  • In Asia today the focus has all been on China, equities have surged higher with property leading the way with major equity benchmarks up +7%. Asia IG spreads are anywhere from 1-5bps tighter, moves have largely tracked those in equities, Financials are underperforming the moves, while O&G names have seen some late weakness following Oil selling off. Gaming names are 1-2pts higher, Property is anywhere from 1-10pts higher.
  • Aus iTraxx CDS is unch at 64bps & while Asia Ex-J iTraxx is 1bp lower at 69.50bps
  • Headlines: China Weighs Injecting $142 Billion of Capital Into Top Banks
  • Primary: Qatar National Bank $300m 5Y Formosa SOFR+115