Key Insights on Financial Markets Gold Market - Gold prices have surged nearly 50% this year, marking the best performance since 1979, driven by institutional investment amid global uncertainty and central bank diversification away from the U.S. dollar [3][10] - Spot gold reached a record high of $3,322.90 per ounce on April 17, 2025, with analysts predicting potential prices of $4,000 within a year and $5,000 in the coming years [3][4] European Bonds - French bond futures declined by 0.18% due to market uncertainty, exacerbated by a Fitch downgrade of France's sovereign credit rating from AA- to A+, the lowest on record, citing political instability and rising debt [5][10] - Ongoing anti-austerity protests and budget negotiation challenges for the new Prime Minister contribute to a cautious outlook for European fixed income markets [6] Asian Equities - The Hang Seng Index in Hong Kong fell by 0.6%, influenced by negative investor sentiment due to a U.S. government shutdown, which complicates the monetary policy outlook [7][10] - The political stalemate in Washington has dampened risk appetite in equity markets and increased demand for safe-haven assets like gold [8] Oil Market - OPEC+'s oil output increases are reducing spare production capacity, raising concerns about future supply disruptions, despite a planned increase of 137,000 barrels per day for November [9][11] - Oil prices saw a modest gain of about 1% in early trading, but analysts expect crude prices to remain weak due to a gloomy global economic outlook and weakening Chinese demand [11] Geopolitical Developments - Moscow's air defenses have successfully intercepted multiple drone threats, leading to temporary disruptions at major airports, highlighting ongoing geopolitical tensions [12] - A diplomatic visit by a Vietnamese leader to North Korea marks an effort by Pyongyang to break its international isolation amidst heavy sanctions [13]

Core Insights - Argentina's international dollar bonds experienced volatility following U.S. Treasury Secretary Scott Bessent's comments regarding U.S. financial support for the country [1][3] - The Argentine peso remained stable at approximately 1,424 per dollar, indicating possible intervention from the treasury, while local stocks increased by 2.5% [2] - Argentina's bonds have seen a significant decline of 15% year-to-date, despite a previous rise of over 100% in 2024 [4] Market Reactions - Following Bessent's initial supportive comments, bonds rose by roughly two cents but later traded negatively before closing up over one cent [2][4] - The peso has depreciated nearly 30% against the dollar this year, with expectations of further devaluation post the October 26 midterm elections [5] Economic Context - The IMF emphasized the need for Argentina to establish a fiscal anchor and a consistent monetary policy to support Milei's ambitious reform agenda [6] - The market is currently testing the U.S. government's commitment to assist Argentina, with uncertainties surrounding the details of support and the impact of the U.S. government shutdown [7]

Report Industry Investment Rating - There is no information provided regarding the report industry investment rating in the given content. Core Viewpoints - The fair initial price talk (IPT) for the new VEDLN 32s is 9.5% [3][6]. - The new USD bonds issuance by VEDLN will notably lower its funding cost and relieve its near - term refinancing pressure [6][8]. - Maintain a buy rating on VEDLN 9.475 07/24/30 due to its better risk - adjusted profile and higher trading liquidity [9]. Summary by Relevant Catalogs Trading Desk Comments - On recent new issues PINGIN 35/CKHH 30/MITSET 30, there were balanced two - way flows. MEITUA widened 1bp amid two - way flows [2]. - There was better buying on Chinese/Japanese/Middle Eastern financial FRNs because of cash - parking demand, and the rest of Asia IG space was unchanged to a touch tighter [2]. - Some PB sold HYSAN Perps amid the latest NWDEVL headlines, with HYSAN 4.85 and 7.2 Perps unchanged to 0.1pt lower, and NWDEVL complex 0.6pt lower to 0.3pt higher [2]. - There was demand on MTRC Perps from AMs due to firmer rates, with MTRC 5 5/8 and 4 7/8 Perps 0.1 - 0.2pt higher [2]. - LASUDE 5 07/28/26 was up by 0.9pt, and Lai Sun Development is close to signing HKD3.5bn secured five - year loan refinancing facility due Oct'25 [2]. - EHICAR 26 - 27s were unchanged to 0.4pt higher, and the two bonds have moved up 2.6 - 3.5pts since last week. EHICAR released moderately better 1H25 results with yoy improvement in profit margin, lower net debts and consistent rebound in utilization rate [2]. - In Chinese properties, VNKRLE 27 - 29s declined by 1.1pts, GRNLGR 29s were 0.9 - 1pt lower, and FUTLAN 28 was down by 0.2pt [2]. - There was better selling on Japanese insurance hybrids and Yankee AT1s in the morning from institutions, and moderately better buying from PBs during the London session [2]. - In Southeast Asia, there were some month - end rebalancing flows on Indian CBKIN/EXIMBK/HDFCB/SBIIN curve. VEDLN 28 - 33s were unchanged to 0.3pt lower [2]. - SMCGL Perps were unchanged to 0.2pt lower, and PCORPM 5.95 and 7.35 Perps were up by 0.1pt. There was little traction in the LGFV space [2]. Morning Update - The new DAESEC 4.375 10/14/28 was largely unchanged from RO at 99.6. AMs bought FRNs to park cash ahead of the Golden Week [3]. - CKINF 4.85 Perp was down 0.7pt. QDJZWD 6.95 03/31/28 and NUFAU 5 01/27/30 were 0.4 - 0.5pt higher [3]. - VEDLN 28 - 33s were largely unchanged this morning, and the IPT of 9.5% for the new VEDLN 32s is fair [3]. - Rakuten plans to issue USD PerpNC5 in mid - Oct'25 to refinance RAKUTN 5.125 Perp first callable in Apr'26. RAKUTNs were unchanged this morning [3]. Top Performers and Underperformers - Top Performers: LASUDE 5 07/28/26 up 0.9pt, JAPTOB 3.3 09/14/51 up 0.7pt, CBAAU 3.9 07/12/47 up 0.7pt, XIAOMI 4.1 07/14/51 up 0.6pt, BABA 5 5/8 11/26/54 up 0.6pt [4]. - Top Underperformers: VLLPM 9 3/8 07/29/29 down 1.3pt, VNKRLE 3.975 11/09/27 down 1.1pt, CCAMCL 4 3/4 12/04/37 down 1.0pt, GRNLGR 6 1/8 04/22/29 down 1.0pt, GRNLGR 6 3/4 09/26/29 down 0.9pt [4]. Macro News Recap - On Monday, S&P (+0.26%), Dow (+0.15%) and Nasdaq (+0.48%) were higher, and UST yield was lower. 2/5/10/30 yield was at 3.63%/3.74%/4.15%/4.71% [5]. Desk Analyst Comments on VEDLN - Vedanta Resources (VRL) proposes to issue 7NC2 144A/Reg S USD bonds (B2/ - /B+) to extend debt maturity and lower funding costs. Proceeds will prepay USD550mn due - Apr'26 private credit facility (PCF) in Oct'25, with excess for debt repayment and general corporate purposes [6]. - The new VEDLN 32s will be issued by Vedanta Resources Finance II Plc and guaranteed by VRL, Twin Star, Welter Trading, and a newly added Vedanta Holdings Mauritius II which holds 12.6% of Vedanta Limited (VEDL). The subsidiary - guarantor group's stake in VEDL increases to 53.6% from 40.99%, and the incurrence debt cap for subsidiary guarantors increases to USD5.2bn (excluding inter - company loans) from USD4.0bn. The new bonds will rank pari passu with existing USD bonds [7]. - Assuming new issue of USD500mn, draw down of USD250mn syndicate facility and prepayment of USD550mn PCF, VEDLN's near - term refinancing pressure will be largely relieved, with no major maturity in the remaining of FY26, cUSD300mn in FY27 and cUSD450mn in FY28. The increase in gross debts at its standalone level to USD4.8bn on a pro - forma basis from USD4.6bn in Sep'25 is manageable, considering LTM dividend income of USD1.3bn and brand fees of USD386mn in FY25 [8]. Offshore Asia New Issues Priced - International Finance Corp issued 20mn USD 10 - yr bonds with a 4.56% coupon at 4.56% priced, unrated [13]. - Mirae Asset Securities issued 300mn USD 3 - yr bonds with a 4.375% coupon at T + 88, rated Baa2/ - /BBB [13]. Pipeline - Rentenbank plans to issue 5 - yr USD bonds with pricing of SOFR MS+41, rated - /AAA/AAA [14]. - Vedanta Resources plans to issue 500mn USD 7NC2 bonds at 9.5%, rated B2/ - /B+ [14]. News and Market Color - There were 31 credit bonds issued yesterday onshore with an amount of RMB27bn. Month - to - date, 2,238 credit bonds were issued with a total amount of RMB1,998bn raised, representing a 30.5% yoy increase [15]. - China is setting up a dedicated department for government debt management and prioritizing deleveraging [15]. - GLP has identified sufficient sources to handle its cUSD2.5bn debt due over the next 12 months [15]. - Indonesia Asahan Aluminium (Inalum) delayed its IPO plan [15]. - JD.com supply chain arm plans to raise USD500mn from Hong Kong IPO [15]. - Medco Energi cancelled its share buyback program [15]. - Nissan Motor is in discussions to sell its 75% stake in Japanese soccer team for cost - cutting [15]. - POSCO International will invest KRW1.6tn (cUSD1.2bn) in new LNG power plants [15]. - Fitch revised the outlook of PTT Public Company and PTT Exploration and Production Public to negative from stable and affirmed BBB+ rating after Thailand's sovereign rating outlook revision [15]. - Italy cleared Sinochem of breaching government's golden power rules regarding Pirelli [22]. - TSMC denied reports of talks with Intel [22]. - Moody's affirmed Tata Motors' Ba1 corporate family rating and changed its outlook to negative from positive [22]. - Vedanta plans to deleverage by calling its outstanding bonds as early as Jun'26 [22].

Japan’s auction of 2-year government bonds drew the weakest demand since 2009 amid speculation that the Bank of Japan will raise rates soon https://t.co/xnJbK31N0U ...

Core Viewpoint - The Shanghai Municipal Financial Committee and the People's Bank of China have issued measures to promote the high-quality development of offshore bonds in the Shanghai Free Trade Zone, aiming to enhance international competitiveness and attract offshore funding [1] Group 1: Policy Framework - The offshore bonds are designed to attract qualified issuers to raise offshore funds, adhering to the principle of "two ends outside" [1] - The issuance rules will follow international standards and practices, encouraging the use of Renminbi while also accommodating the foreign currency needs of issuers [1] Group 2: Operational Mechanism - The business will be conducted through registered custodial institutions in the Shanghai Free Trade Zone, targeting qualified investment entities for the issuance of securities and other transferable debt securities [1]

Core Viewpoint - Investors are increasingly investing in exchange-traded funds (ETFs) that focus on investment-grade corporate bonds due to a significant rise in the supply of new debt in the fixed-income market [1] Group 1 - There has been a notable surge in the issuance of new investment-grade corporate bonds, attracting investor interest [1] - The influx of capital into these ETFs indicates a strong demand for safer fixed-income investments amid market fluctuations [1]

Foreign selling of Indonesian bonds this month is set for the largest in three years as worries over the nation’s fiscal outlook mount. https://t.co/yP6Vhgw0wP ...

Investment Flows - Municipal-bond funds experienced the largest cash inflow since at least 2007 [1]

Core Viewpoint - The bond market is experiencing intensified competition between bulls and bears, with significant fluctuations in interest rates, particularly for the 10-year government bonds, which are influenced by potential central bank actions and redemption fee issues for public bond funds [1][14]. Group 1: Central Bank Actions - There is uncertainty regarding whether the central bank will restart bond purchases, as recent buying behavior from major banks does not provide a clear conclusion [2][14]. - Major banks have net bought 9.3 billion yuan of 7-10 year government bonds since September, indicating a shift in preference towards longer-term bonds [2][14]. Group 2: Bond Fund Redemption Fees - The potential optimization of punitive redemption fees for bond funds is under discussion, with expectations for clearer guidelines by the end of the month [3][15]. - As of mid-2025, the total scale of bond funds is approximately 11.15 trillion yuan, with institutional investors holding about 8.99 trillion yuan, suggesting significant exposure to potential redemption fee impacts [3][15]. Group 3: Market Sentiment and Funding Conditions - The bond market is currently in a chaotic state, with both bullish and bearish arguments being strong, but bearish sentiment slightly prevailing [5][16]. - The funding environment is slightly tight, with the R001 rate peaking at 1.58%, influenced by banks shortening their liability durations [4][16]. Group 4: Recent Market Movements - From September 15-19, the bond market showed a V-shaped reversal in interest rates, with the 10-year government bond yield rising to 1.80% [6][10]. - The overall bond market sentiment has been fluctuating, with yields stabilizing around previous levels, indicating a lack of significant movement [10]. Group 5: Upcoming Events - Key upcoming events include a press conference involving central bank and regulatory officials on September 22, and the maturity of 3,000 billion yuan of MLF on September 24 [13].

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