The TR BPAM All Bond Index recorded a gain of 0.26 per cent to close at 133.04, as compared to 132.69 last Friday.
This is the largest weekly gain in the past two months, which was mainly due to the bullish movement in the sovereign segment, where MGS and GII yields have lowered by one basis point (bps) to 10bps from the three-year tenure and onwards.
The bullish movement in the sovereign segment was supported by the strengthening of the ringgit to 3.2395 against the US dollar from 3.2850 last Friday.
In the same week, the US Treasury had also seen yields falling by 14bps to 21bps for the three-year to 30-year tenure region.
Looking at the top 10 most active bonds, total trade volume increased significantly from RM9.86 billion last week to RM15.04 billion this week.
During the week, the trading interest was focused on the seven-year tenure region as the seven-year benchmark MGS and GII topped the list with RM3.30 billion and RM2.40 billion changed hands respectively.
Meanwhile, for sovereign bond auction, the government of Malaysia announced on April 10 the re-opening of 15-year benchmark GII with an issuance size of RM1.5 billion. The tender is scheduled to be closed on April 14, 2014.
For new bond issuances during the week, Maybank Islamic Bhd on April 7, 2014 issued a RM1.5 billion sukuk under its Basel III-compliant Surbordinated Sukuk Murabahah Programme.
The 10 non-call 5-year tenure sukuk is rated AA1 by RAM Ratings and carry a profit rate of 4.75 per cent.
On the same day, Government of Malaysia issued a 7.5-year SPK (Sukuk Perumahan Kerajaan) with an issuance size of RM2.6 billion, of which RM1 billion was privately placed and the remaining was issued through tender that closed last Friday. On April 10, 2014, IJM Corporation Bhd issued three tranches of five-year to seven-year sukuk with a total issuance size of RM500 million.
The sukuk were assigned an AA3 rating by RAM Ratings and bear profit rates between 4.60 per cent and 4.85 per cent.