China secondary bond market:

Offshore trading volume increased slightly

Offshore trading volumes increased slightly

• Based on MIFID and TRACE data, China offshore names' total trading volume was only $6.9 billion in May, slightly up from April. Investment grade issuers including Alibaba and Tencent were among the most liquid.
• TAGG <GO> provides a display of aggregated post-trade volumes for fixed-income securities, to show market direction and liquidity.

Offshore trading volume of China issuers ($ millions)

Source: Bloomberg TAGG <GO>; TRACE and MIFID data

---

---

Double-A airline had the biggest spread widening
Domestic bonds saw lower volatility in May as China pledged to support its economy at both the central and provincial levels. The domestic bond universe's average option-adjusted spread (OAS) for fixed-rate medium-term notes tightened by 14 basis points for all rating buckets and sectors, and 13 bps for the real-estate sector, compared to end-April. AA+ rated issuer JuneYao Group which owns a majority stake in JuneYao Airlines, suffered a selloff of its medium-term notes due to the Covid-19 resurgence in Shanghai. Market volatility risk may have impacted chengtou issuers with some 1-month spreads widening for select names.

Use FIW@CN to see the yield change based on local ratings and issuers of China's domestic bonds by sector.

China domestic bonds' spread change in May

Source: FIW@CN <GO>, Bloomberg Intelligence