Malaysian Bond Market
Local govvies’ yields rose across all tenures amid the softer ringgit and tracking the rise in UST following renewed optimism for a tax reform. At Friday’s 11am pricing, the 3-, 5-, 7-, 10-, 15-, 20- and 30-year benchmark Malaysian Government Securities (MGS) yields settled at 3.51%, 3.76%, 4.02%, 4.04%, 4.45%, 4.65% and 4.98%, respectively.
Trading activities for the bench- mark local govvies surged this week. Trading volume for the week stood at RM9.86bil, compared to RM3.39bil in the previous week.
In the case of the secondary corporate bonds market, trading activities softened compared to the previous week. Week to date, total trading volume was at RM1.50bil compared to previous week’s RM1.61bil. About 73% of the trading volume came from GG/AAA while 25% was from the AA segment and the balance 2% from the A segment.
In the GG/AAA segment, notable trades included 2023-2032 Perbadanan Tabung Pendidikan Tinggi Nasional tranches ,which closed with yields unchanged or higher between 4.28% and 4.85% with a trading volume of RM290mil.
There was also interest in the 2018-2024 Cagamas tranches, which closed with mixed yields 3.69%4.35% and a total trading volume of RM250mil.
Meanwhile, in the construction sector, ‘05/25 Jambatan Kedua bond garnered interest, having recorded a trading volume of RM70mil, closed with yields 17 basis points (bps) higher at 4.38%. Furthermore, ‘04/20 and ‘09/27 Danga Capital bonds ended with yields unchanged or higher at 4.09% and 4.70% respectively, with RM65mil changing hands.
Elsewhere in the AA segment, notable trades were seen in 20212026 UMW Holdings tranches, which recorded a total trading volume of RM50mil with yields unchanged or higher between 4.61% and 4.95%. Meanwhile, ‘12/24 Jimah East Power bond recorded a trading volume of RM35mil and closed with yields higher by 1 bps at 4.69%.
Also attracting interest this week were ‘12/19 and ‘03/26 BGSM Management bonds, which recorded yields lower or higher at 4.37% and 4.91% respectively, with a collective trading volume of RM32mil. In addition, ‘03/24 Al Dzahab Assets bond recorded with yields 16 bps lower at 5.84% with RM30mil changing hands.