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CREDIT UPDATE: Aussie Credit Spreads Widen Post Flurry Of Primary Deals

CREDIT UPDATE
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  • Asian stocks traded in a narrow range as investors weighed potential new US curbs on chip sales to China and awaited possible stimulus measures from Beijing. Mainland China and Hong Kong equities declined after a recent rally, while Japanese stocks rose on gains in chip-related shares and a weaker yen. Korean shares fluctuated following a surprise interest rate cut by the central bank. Meanwhile, US equities slipped overnight as an acceleration in the Fed's preferred inflation measure supported a cautious stance on rate cuts, the NASDAQ led losses overnight with Dell and HP plunging nearly 12% after reporting disappointing sales
  • It has not been a great day for Aussie credit today, in primary there was just Angle Asset Finance looking to do ABS deal. The recently issued BNP deal is now trading 20-22bps wider, while the new CBA T2 is trading +13bp, New Goodman is trading +5bps & Aurizon is +4bps. Spreads were trading at tightest levels in years heading into the past two week, but with a flurry of primary activity clients look to be a bit full, Dealers also seem full heading into year-end, while account that are looking to fund any of the recent issues have had to offload deal pushing everything even wider, BNP has been the worst performing with many accounts full on the name after they printed an earlier T2 deal only a few months ago. Overall Snr is trading +1/+3bps, seasoned Major bank Sub is trading +3/+6bps, seasoned Non Major Bank is anywhere from +5/+10bps, Corps are +1/+4bps, HY/AT1 is trading 0.5 to 1.5pts lower, the worst performing bonds have been the recently issued stuff.
  • Asia IG is trading much better than Aus today, IG trading unch, while HY is a touch weaker. Chinese companies are leading activity in the dollar bond market, with at least two issuers pricing new offerings. Meanwhile, India’s IG dollar bonds have underperformed due to charges against Adani Group’s founder, though Adani Ports' bonds have slightly recovered.
  • Headlines: Chinese authorities approved a 500b yuan bond quota for state-owned asset managers to fund growth-boosting projects.
  • Primary: Qingdao Jimo District $TBD 2Y Reg S At 6.9%, Zhejiang Hanghai Xincheng USD 3Y SBLC Bond 5.2% Area
  • Aus iTraxx CDS is -0.50bps at 66bps & Asia Ex-JP iTraxx is unch at 74bps
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  • Asian stocks traded in a narrow range as investors weighed potential new US curbs on chip sales to China and awaited possible stimulus measures from Beijing. Mainland China and Hong Kong equities declined after a recent rally, while Japanese stocks rose on gains in chip-related shares and a weaker yen. Korean shares fluctuated following a surprise interest rate cut by the central bank. Meanwhile, US equities slipped overnight as an acceleration in the Fed's preferred inflation measure supported a cautious stance on rate cuts, the NASDAQ led losses overnight with Dell and HP plunging nearly 12% after reporting disappointing sales
  • It has not been a great day for Aussie credit today, in primary there was just Angle Asset Finance looking to do ABS deal. The recently issued BNP deal is now trading 20-22bps wider, while the new CBA T2 is trading +13bp, New Goodman is trading +5bps & Aurizon is +4bps. Spreads were trading at tightest levels in years heading into the past two week, but with a flurry of primary activity clients look to be a bit full, Dealers also seem full heading into year-end, while account that are looking to fund any of the recent issues have had to offload deal pushing everything even wider, BNP has been the worst performing with many accounts full on the name after they printed an earlier T2 deal only a few months ago. Overall Snr is trading +1/+3bps, seasoned Major bank Sub is trading +3/+6bps, seasoned Non Major Bank is anywhere from +5/+10bps, Corps are +1/+4bps, HY/AT1 is trading 0.5 to 1.5pts lower, the worst performing bonds have been the recently issued stuff.
  • Asia IG is trading much better than Aus today, IG trading unch, while HY is a touch weaker. Chinese companies are leading activity in the dollar bond market, with at least two issuers pricing new offerings. Meanwhile, India’s IG dollar bonds have underperformed due to charges against Adani Group’s founder, though Adani Ports' bonds have slightly recovered.
  • Headlines: Chinese authorities approved a 500b yuan bond quota for state-owned asset managers to fund growth-boosting projects.
  • Primary: Qingdao Jimo District $TBD 2Y Reg S At 6.9%, Zhejiang Hanghai Xincheng USD 3Y SBLC Bond 5.2% Area
  • Aus iTraxx CDS is -0.50bps at 66bps & Asia Ex-JP iTraxx is unch at 74bps