2021 dividends are predicted to increase by 6.5% compared to 2020. Our positive outlook reflects increasing busines… https://t.co/6z4yNniHiI
iBoxx SGD Monthly Update: October 2020
Mid-September saw global Covid-19 cases surpass 30 million. The FOMC meeting on 16 Sep saw the FED continuing to apply its accommodative monetary policy stance in the wake of the continuing pandemic. Rates were kept near zero and the FED underlined its commitment to keep buying US Treasuries and Agency MBS via the SOMA account. Concurrently, most global yields fell during September.
Meanwhile, most worldwide equity markets closed narrowly down by month-end, equity volatility and global credit spreads were largely range bound and regional Asian fixed income markets were a mixed bag.
In Singapore, economic news was also mixed with the release of a downbeat Labour Market Second Quarter 2020 report (showing the extent of the pandemic's impact on hiring) followed by an upbeat Non-Oil Domestic Exports (NDOX) report released a few days later.
In September, the iBoxx SGD overall index gained 0.92%, recouping much of the loss it suffered over August. Positive returns were observed across much of the index. Single A was the best performing rating segment with longer dated bonds of this rating significantly outperforming. Overall BBBs were the next best performing rating segment but the BBB/10+ bucket (comprised of one single bond - a Keppel Corp 20yr bond) performed poorly and posted negative returns.
As of 30 September 2020, the overall index offered a yield of 1.29% (down 0.12 percentage points from the previous month-end) with a duration just over 7 years.
October 2020 Rebalance
Six corporates (including 3 real estate related bonds), accounting for over SGD 2 billion notional, were added to the index at the October rebalance.
Seven bonds with less than 1 year of expected remaining life were removed from the index due to the index minimum time to maturity rule. The total notional deleted summed to just over SGD 1.6 billion and included a SGD 650 million HDB bond.
Please refer to the table in the full commentary for rating changes observed at the October rebalance.
IHS Markit provides industry-leading data, software and technology platforms and managed services to tackle some of the most difficult challenges in financial markets. We help our customers better understand complicated markets, reduce risk, operate more efficiently and comply with financial regulation.
Follow Financial Services
- 2021: Brexit, no equivalence and the day of the SEF
- Seven key dividend forecasts for 2021
- IHS Markit to Publish Daily Credit Spread Adjustment for SOFR from Q2 2021
- Daily Global Market Summary - 20 January 2021
- A new COO/CCO playbook for financial regulation in 2021
- Daily Global Market Summary - 19 January 2021
- 2020 Corporate Access Survey Series: Broker Selection and Service Satisfaction
- Corporate actions: How the events of 2020 will impact the year ahead
As the SOFR has been recommended to replace USD LIBOR, we are developing a USD credit spread adjustment, which util… https://t.co/lj7LIoiT81
The equity new issuance market had an unprecedented year in 2020, pricing a record 1,500 deals that raised a combin… https://t.co/Iyd6bSBUKJ