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Local government bonds surge

(ATF) – The ATF AllIndex CBM50 Index of leading Chinese bonds climbed for a second day, advancing 0.07% to 106.68. Gains were bolstered by the biggest jump in a month on the Local Government sub-index.

The ATF ALLINDEX family have started the week on a firm note with the ATF ALLINDEX Local Governments climbing 0.24% on the day.

For the month of March, the CBM50 returned 0.075%, the ATF ALLINDEX Local Governments index returned 0.75%. The Corporates index edged up 0.03% on the day with the one month return of -0.13%.

The Financials index added 0.02% on the day and returned 0.43% for March. The ATF ALLINDEX Enterprise index returned -0.05% for March following a rise of 0.01% on the day.

This month has been quite a roller coaster for a number of assets. US corporate high-yield bonds have recovered some of their lost ground and HYG closed at 77.65 up from a low of 69.35 on 23-03-20. Investment-grade US bonds have shown an even more impressive rally with LQD closing at 123.92, up from a low 105.50 on March 18.

The spread between Chinese five-year treasury bonds and five-year corporate debt started to slightly widen this month. While the spread was at 80bps at the beginning of March, it ended at 110bps on Tuesday. 

ATF ALLINDEX CBM50 Bond Index: A 50-constituent index, updated daily and selected from across the entire Chinese onshore bond market, that provides a benchmark measure of the Chinese onshore fixed income market. The CBM50 is taken from the ATF ALLINDEX Chinese Bond Market Index that tracks the price movements of Chinese CNY-denominated onshore bonds across the Corporate, Enterprise, Financial and Local Governments sectors.


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