SG Bonds Weekly – Week 50 December 7, 2020 548

Outlook for the week

Key economic releases for the week

  • Mon, 7 Dec: SG: Foreign Reserves (5:00PM), CH: Exports YoY
  • Tue, 8 Dec: SG: Manpower Survey (12:01AM), US: Nonfarm Productivity (9:30PM)
  • Wed, 9 Dec: CH: CPI YoY (9:30AM)
  • Thu, 10 Dec: US: CPI YoY (9:30PM), ECB rates decision


Last week summary

Primary issuance in Asia G3 markets picked up strongly this week after 2 weeks of lull. Investment grade issuers were active, taking up 71.4% of the week’s total volume. Most of the issuance came from Greater China, with the Republic of Philippines as the exception of the week. Investor demand for risk is strong, with both average book coverage and average IPG tightening exceeding YTD averages.

  • Hong Kong’s Airport Authority, the operator of Hong Kong International Airport, issued USD 1.5bn dual-tranche senior perpetual bonds that attracted enthusiastic demand from the market. As the first Hong Kong IG issuer since October, strong institutional investor interest resulted in aggressive spread tightening from initial price guidance. The PerpNC5.5 tranche was priced at 2.1% and the PerpNC7.5 tranche was priced at 2.4%, with initial price guidance tightening of 65bps and 70bps respectively. Final order books were 9.7x covered on average.
  • Chinese real estate companies continue to be active issuers into the last month of 2020. 6 real estate issuers took advantage of the uptick in market conditions to print USD 1.6bn of bonds in total. Significant momentum continued in this sector, especially in the high yield new issues. Average book coverage for Chinese high yield real estate (8.9x) and average IPG Tightening (49.2bps) surpassed YTD levels (7x, 36.58bps).
  • New issue pipeline remains slow with 2 new mandate outstanding from the ones announced over the fortnight.


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About the author

Profile photo of Timothy Ang

Timothy Ang
Research Analyst
Phillip Securities Research

Timothy covers the US technology sector focusing on hardware companies. Previously a credit analyst, he handled bond analysis and research for the fixed income desk. He has presented seminars for organisations such as SIAS, SPH and IRAS, commentated live market updates for 93.8FM, and authored investment articles for the Business Times newspaper. He graduated with a Bachelor of Commerce in Accounting & Finance from the University of Western Australia.

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