Halister News

--NOUR AL ALI

(Bloomberg) -- BNP Paribas says situation surrounding Wanda group has become a “black box, where no outsider has any advantage looking in” given lack of information on Chinese government’s intent and actions to company.

• “We have a categorical distaste for black-box trades, and would exit the bonds to those who are more willing in this regard,” Charles Chang, head of Asia credit strategy at BNP Paribas, wrote in a note
• Bonds and shares of Wanda group companies fell Monday after reports its billionaire Chairman Wang Jianlin and his family were stopped leaving the country. The company denied the reports, calling them “groundless” 
• Past stories of chairmen at Chinese companies going missing have been untrue or had a limited impact on the firms involved. BNP expects a similar outcome in Wanda’s case
  • Bondholders who are willing to wait out the outcome can hold, but should be ready to accept a “3pt-10pt volatility range”
• Earlier stories:
  • Wanda Is Said to Face Crackdown, Checking Hollywood Ambitions
  • China Said to Examine Deals Gone Awry to Gauge Banking Risks

To contact the reporters on this story: Carrie Hong in Hong Kong at chong61@bloomberg.net; Annie Lee in Hong Kong at olee42@bloomberg.net To contact the editors responsible for this story: Neha D'silva at ndsilva1@bloomberg.net Finbarr Flynn

(Bloomberg) -- India’s sovereign bonds decline as yields climb to their highest levels in almost three months on concern of larger debt supply coming into the market this week.

• RBI plans to sell up to 100b rupees ($1.6b) of bonds via OMO Tuesday
  • RBI will also sell 160b rupees of bills Wednesday, 180b rupees of bond sales scheduled Friday
• Higher supply of bonds is weighing on the market sentiment, says Anoop Verma, fixed-income trader at DCB Bank in Mumbai
  • Expects 10-year bond yield to be in a range of 6.40% to 6.60% in the coming weeks
• Yield on 6.79% bonds due May 2027 rises 2bps from Thursday to 6.56%, set for highest close since June 7; yield rose 3bps last week
• India’s financial markets were shut Friday for a local holiday
• Read: Patel may hold bond quotas as India faces impossible trinity

To contact the reporter on this story: Kartik Goyal in Mumbai at kgoyal@bloomberg.net To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net Patricia Lui

(Bloomberg) -- Nomura favors receiving 2- and 3-year interest rates swaps in Singapore and Thailand as they provide one of the highest Sharpe ratios in the region, says rates strategist Vivek Rajpal.

• “It looks like we are still in a low vol world,” after Jackson Hole turned out to be a non-event to the markets, he says
• “Stable global yields, low volatility and high real rates in many places in the region make me believe that positive carry bias will perform”
• From a medium-term perspective, low inflation in the Asian region and better liquidity in the banking system will push yields lower, especially at the front-end
• Broad short dollar environment helps capital flows into Singapore and Thailand, adding liquidity in their banking systems
• NOTE: SGD 2-year interest-rate swap drops 4bps to 1.35%; THB non-deliverable IRS slides 4bps to 1.43%
  • SGD 2-year IRS offers a carry and roll-down gain of 7.9bps over three months, THB 5.6bps, according to Bloomberg data

To contact the reporter on this story: Masaki Kondo in Singapore at mkondo3@bloomberg.net To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net Patricia Lui

(Bloomberg) -- Here’s a roundup of Indian co. debt-rating changes.

• To get this story sent to your inbox real-time, run NI INRATINGS, click on Display & Edit, then Set Alert Delivery

DOWNGRADES

• MIOT Hospitals
  • Long-term rating cut to BBB from BBB+ at Crisil
  • Cites deterioration in business risk profile due to floods in Dec. 2015 and delay in revamp of operations

UPGRADES

• Kogta Financial India
  • Subordinated NCDs raised to BBB- from BB+ at Crisil
  • Cites improved scale of operation, adequate capitalization and earnings profile