EM ASIA CREDIT: MNI EM Credit Market Wrap - Asia
** The main stories out of the region**
U.S. 10y treasury yields were 2bp lower at 4.3% in Asia hours as we head into the U.S. payroll numbers. In Asia emerging market govie/agency bonds, the bias is for wider spreads (1-2bp) as markets grapple how to manage tariff risks. In terms of newsflow, JD.com announced its Q4 results after market close yesterday, which were ahead of market consensus. Positive for spreads. We also continue to see support for Steel makers, notably Posco. We also note that some China real estate bonds outperforming, with Greentown 2/28s 13bp better on the day, as improving property sales may be further proof the sector is lifting off the bottom. No new issuance for today.
Best & Worst Performers (zsprd, bp)
Source: Bloomberg
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
EGBS: Spreads To Bunds Little Changed To A Touch Wider As Equities Tick Lower
Spreads to Bunds within 1bp of yesterday’s closing levels, with weakness in e-mini futures since yesterday’s close and a downtick in European equities probably promoting modest widening against the outright bond rally.
- No tangible widening in RAGBs after media reports pointed “at least a temporary halt” in coalition government discussions between the right-wing FPÖ and conservative ÖVP. Both parties have since noted that discussions are set to continue today, limiting the market fallout.
- Similarly, no meaningful, lasting reaction to the PMI readings, with a mark lower in the French final services PMI providing the most notable takeaway.
MNI: EUROZONE JAN FINAL SRVCS PMI 51.3 (FLASH: 51.4); DEC 51.6
- MNI: EUROZONE JAN FINAL SRVCS PMI 51.3 (FLASH: 51.4); DEC 51.6
- EUROZONE JAN FINAL COMP PMI 50.2 (FLASH: 50.2); DEC 49.6
CROSS ASSET: Yields are pushing lower
Looking at the German 10yr Yield, as mentioned in the Opening Bund comment, risk remains to the upside in Futures, and further momentum will highlight the 2.30% level, printed a 2.309% low in January.
Today, reference 133.40:
- 2.30% = 134.19.
For support, while Yesterday's low is situated at 132.72, initial area of interest comes at 132.34 (Monday's opening gap).
Watch Tnotes here, testing session high, decent buying interest is going through, and while this Week saw a 109.20 high print, the next area of interest comes at 109.29, not a Tech level, but where it was trading at pre 18th December FOMC Hawkish meeting.
USDJPY lis through 153.00, with next support seen at 152.55 61.8% retracement of the Dec 3 - Jan 10 bull leg.
