Malaysian Bond Market

The local bond market began the week in a lacklustre mode with muted trading activities. As risk-off sentiments permeate global markets, local govvies remained largely resilient apart from some knee-jerk selling pressure on Thursday morning. Besides, Bank Negara held a re-opening auction for the 20-year MGS 06/38 which saw a sizable issuance of RM3.0bil. The auction was well received, garnering a BTC of 1.657x while averaging at 4.759%. As at Friday noon, the 3-, 5-, 7-, 10-, 15-, 20and 30-year benchmark MGS yields settled at 3.61%, 3.77%, 4.01%, 4.13%, 4.56%, 4.74% and 4.92% respectively.

Flows for local govvies tapered off to RM7.3bil compared with last week’s RM8.1bil.

Meanwhile, trading activities in the secondary corporate bond space decreased further to RM1.2bil versus last week’s RM2.2bil. Some 48% of trade volume came from the GG/AAA segment while 47% were attributed to AA-rated papers and the remaining 5% from the A segment.

In the GG/AAA segment, interest was seen in DanaInfra Nasional Bhd’s long-end 2031-2043 tranches with yields mixed between 4.58% and 4.99% on the back of RM98mil trade volume.

Interest was also seen in Telekom Malaysia Bhd’s 24s and 28s with yields closing between 4.34% and 4.39% amid RM75mil flows. Also, Cagamas’ 2019-2023 papers witnessed RM62mil flows with yields mixed between 3.59% and 4.20%. Meanwhile, PTPTN’s 03/32 paper saw yields flat at 4.63% with RM60mil changing hands.

On to the AA-rated space, tepid flows were dominated by energy names with Southern Power Generation Bhd’s 2022-2035 tranches garnering a trade volume of RM120mil with yields closing mixed between 4.46% and 5.21%. AmBank Islamic’s 03/20 sukuk musyarakah on the other hand saw RM80mil traded with yields closing 4bps firmer.

Meanwhile, interest was also seen in BGSM Management’s 2021-2023 papers which saw yields mixed between 4.43% and 4.55% with RM65mil volume traded. Lastly, DanaJamin’s 10/27 IMTN saw RM50mil traded with yields closing 1bps firmer at 4.67%.