Wednesday, March 20, 2013 (IFR) - Asia credit markets trod
water for much of the day, but had a slightly more supportive
tone after Europe came in looking as if the Old Continent was
willing to shrug off the Cypriot parliament's rejection of the
proposed bank deposit levy.
"I expect markets to retrace much of what they have shed
over the past few days and I don't see any dark scenario
emerging from the Cyprus impasse. Still, if the Cypriot banks
remain closed for the rest of the week, you start to get into
the Easter holiday period.
If deals are not brought because of that, then the second
week of April could look messy as banks look to bring a primary
pipeline that is building strongly," said a Singapore-based
Credits did not recover fully, although and the iTraxx IG
Index closed 1bp wider at 103bp/105bp in the context of thin
Meanwhile, recent new issuance is mixed. The newly minted
IDBI long 5-year is out at Treasuries plus 304bp bid off a plus
300bp reoffer, having printed, at one point, as wide as plus
This relatively soft performance has put some repricing
pressure on the India FIG curve, with the ICICI complex around
6bp wider and Axis Bank's around 7bp wider, with the rest of
India FIG off around 2bp-3bp.
The recently tapped Glorious Property due 2018s are off 25
cents at 99.75 bid, while the KWG 2020s are up 37.5 cents at a
99.00 bid and the Longfor 2019s are up 50 cents at 106.125 bid.
The sector will be tested if Single B developer Zhong An's
ongoing roadshows leads to a deal, with the kind of punchy
pricing execution that prevailed in January unlikely to make a
reappearance in the midst of the risk-off bias.