Malaysian Bond Market
Local govvies’ yields on the shorter end of the curve rose while yields on the opposite end fell.
Focus of the week was on the reopening auction for the 3Y MGS 11/21 with an issuance size of RM3bil, which garnered a modest BTC of 1.996x. At Friday’s noon pricing, the 3-, 5-, 7-, 10-, 15-, 20- and 30-year benchmark MGS yields settled at 3.42%, 3.55%, 3.88%, 3.95%, 4.41%, 4.41% and 4.81% respectively.
Trading activities for the benchmark local govvies mostly remained similar to last week as market participants were largely affected by poor sentiments. For the week, trading volume rose to RM8.9bil from RM7.2bil in the week prior.
Trading activities in the secondary corporate bond market improved compared to the week prior. Week to date, total trading volume was relatively higher at RM2.9bil in comparison to last week’s RM1.4bil. Roughly 80% of the trading volume came from GG/ AAA while 19% was from the AA segment and the balance 1% from the A segment.
In the GG/AAA segment, notable trades included 2018-2024 Khazanah Nasional Bhd tranches which closed with mixed yields between 3.51% and 4.41% respectively, amounting to a total trading volume of RM400mil. There was also interest in 2019 Pengurusan Air SPV Bhd tranches which registered mixed yields between 3.74% and 3.80% with RM395mil changing hands. Furthermore, interest was seen in the 2019-2029 Prasarana Malaysia Bhd tranches which closed with yields mixed between 3.74% and 4.66%, amounting to a total trading volume of RM335mil.
Meanwhile, ‘12/18 and ‘03/21 Cagamas Bhd bonds were seen with yields mixed between 3.83% and 4.17% respectively with a total trading volume of RM310mil.
Elsewhere in the AA segment, notable trades were seen in 2023-2035 Southern Power Generation Sdn Bhd tranches which posted a trading volume of RM131mil and closed with mixed yields between 4.63% and 10.71%.
Meanwhile, ‘01/25 Edra Energy Sdn Bhd recorded a trading volume of RM50mil with yields down by 2.3bps to 5.33%. Furthermore, the 2022-2023 UEM Sunrise Bhd tranches recorded lower yields between 4.78% and 4.85% with a trading volume of RM50mil.
In addition, there were some interest in 2021-2032 Tanjung Bin Energy Issuer Bhd tranches which recorded yields between 4.47% and 5.12%, with RM40mil changing hands.