Offshore trading volumes fall
Chinese credit issuers offshore trading volume ($ millions)
Source: Bloomberg TAGG <GO>; based on TRAC and MIFID monthly data
Offshore trading volume of China real estate issuers ($ millions)
Source: Bloomberg TAGG <GO>; based on TRAC and MIFID daily data
Onshore trading volumes drop even lower Onshore trading volume in December fell 43% from November. The December volume of around $850 million was the lowest point since February. Investment-grade bonds comprised 94% of December's trading. Bond yield and index change Domestic bonds were immune to the recent real estate contagion as the bond universe's average option-adjusted spreads (OAS) for fixed-rate medium-term notes finished wider by 12 bps for all rating buckets and sectors. AA+ rated issuer JuneYao Group, which owns a majority stake in JuneYao Airlines, continued to suffer a selloff across its medium-term notes due to the COVID-19 resurgence in China. There may be some idiosyncratic risk in Chengtou issuers as some issuers' 1-month spread went wider. For example, AAA Chengtou issuer Tianjin TEDA Investment's 2023 maturity traded 595 bps wider than the previous month. The 1-month OAS change is significantly higher than the AAA bucket's average at 8.5 bps. Use FIW@CN to see the yield change based on local ratings and issuers of China's domestic bonds by sector.
China issuers onshore trading volume ($ millions)
Source: Bloomberg Quant Platform (BQuant), Global Data
China domestic bond 1-month OAS change
Source: Bloomberg FIW@CN <GO>, Bloomberg Intelligence
