Malaysian bond market

Benchmarks Malaysian Government Securities (MGS) yields traded higher by 6-24 bps from the prior week, save for 15-year MGS which traded 22 bps lower. As of Thursday’s close, yields on three-, five-, seven-, 10-, 15- and 20-year MGS stood at a respective 3.36%, 3.58%, 3.64%, 3.73%, 4.05% and 4.38%. The week saw RM5.6bil worth of trades changing hands with a daily average trading volume of RM1.4bil compared with last week’s RM3.1bil.

Moving to the local private debt private market, total trading volume picked up to RM2.3bil compared with RM859mil in the prior week. Fifty per cent of the trading volume was contributed by the GG/AAA segment, 47% by the AA segment and the balance by the A segment. Daily average trade volume was higher at RM563mil versus the RM215mil average seen in the previous week.

In the GG/AAA segment, Silterra ‘06/14 saw RM200mil worth of trades, with yield unchanged at 3.25%. Other notable trade included longer tenured Telekom bonds maturing 20212023 garnered trading volume of RM160mil and Cagamas MBS bonds closed 5-6 bps higher.

Along the AA curve, trading activity was mostly seen on bank papers and in the power sector. Bank papers include HLBB sub-debt papers garnered a collective trading volume of RM80mil with yields up 1-6 bps from last trade levels. Notable trade in the power sector was SEB bonds maturing 2016-2022 traded mixed with RM130mil changed hands. Elsewhere, WCT bonds traded 1-3 bps lower from previous trade levels.