Latest news with #CSIConvertibleBondIndex
Yahoo
20-03-2025
- Business
- Yahoo
China's Convertible Bonds Surge as Stock Rally Spurs Demand
(Bloomberg) -- The euphoria over Chinese stocks has hammered much of the country's debt market, with a notable exception: convertible bonds. ICE Eyes Massive California Tent Facility Amid Space Constraints How Britain's Most Bike-Friendly New Town Got Built Washington, DC, Region Braces for 'Devastating' Cuts from Congress The Dark Prophet of Car-Clogged Cities Saving the Signature Sound of Washington, DC The CSI Convertible Bond Index, a gauge measuring the performance of such notes listed in Shanghai and Shenzhen, rose 0.3% on Monday to its highest level since 2015. The advance comes as a rally in Chinese equities boost the appeal of debt that can be converted into equities. Convertible bonds are headed for a seventh straight month of gains, the longest such streak since early 2020. With a maturity wall looming for the securities this year, the supply and demand dynamic is also improving. While the massive payment due was deemed a risk, sentiment has turned more favorable after a slew of issuers including China Citic Bank Corp. redeemed their debt. The outstanding amount of the securities has dropped about 30 billion yuan ($4.1 billion) this year, according to Kangtai Song, senior analyst at Topsperity Securities Co. With strong performance in equity sectors such as AI and robotics, convertible bonds in related industries have also benefited, Song added. --With assistance from Mengchen Lu. (Updates with analyst comment in the fourth paragraph) Nvidia Looks Past DeepSeek and Tariffs for AI's Next Chapter How America Got Hooked on H Mart How Trump's 'No Tax on Tips' Could Backfire for the Working Class The Real Reason Trump Is Pushing 'Buy American' College Presidents on Trump, Tuition and Universities Under Pressure ©2025 Bloomberg L.P. Sign in to access your portfolio
Bloomberg
17-03-2025
- Business
- Bloomberg
China's Convertible Bonds Surge as Stock Rally Spurs Demand
The euphoria over Chinese stocks has hammered much of the country's debt market, with a notable exception: convertible bonds. The CSI Convertible Bond Index, a gauge measuring the performance of such notes listed in Shanghai and Shenzhen, rose 0.3% on Monday to its highest level since 2015. The advance comes as a rally in Chinese equities boost the appeal of debt that can be converted into equities. Convertible bonds are headed for a seventh straight month of gains, the longest such streak since early 2020.
Yahoo
18-02-2025
- Business
- Yahoo
Chinese Convertible Bonds Entice Investors Extending AI Bets
(Bloomberg) -- Chinese investors' zeal for artificial intelligence-related assets fanned by DeepSeek has spread to convertible bonds, sending a benchmark index to its highest in more than two years. Why Barcelona Bought the Building That Symbolizes Its Housing Crisis Progressive Portland Plots a Comeback Por qué Barcelona compró el edificio que simboliza su crisis inmobiliaria A Filmmaker's Surreal Journey Into His Own Private Winnipeg How to Build a Neurodiverse City The CSI Convertible Bond Index has risen 3.3% this year, hitting its highest since August 2022 on Tuesday and tracking gains in the stock benchmark gauge. Shanghai Runda Medical Technology Co. and Thalys Medical Technology Group, two of the companies expected to benefit from AI integration, have seen their convertibles soar more than 22% and 16%, respectively, this year. The gains add to the rally convertible bonds have seen since Beijing announced a slew of stimulus measures for economic growth in September. While CBs' lukewarm start to the year portended a stall in the rally, Chinese startup DeepSeek's potential ignited a tech frenzy in late January and changed the landscape on AI bets in China. 'China convertible bonds are still lucrative even with a rebound in recent months,' Liu Yang, a fund manager at HSBC Jintrust Fund Management Co. said, citing 'reasonable' pricing, low government bond yields and AI's impact on the economy that will be sustained. More anticipated government policy support that may spur a recovery will also propel them higher, he said. A rosier outlook for convertible bonds has rendered something of a haven for fixed-income investors scouring for decent returns in a market with historically low sovereign yields and tepid growth. Mitigated Risk The auspicious start to the year follows a string of messy developments for CBs in 2024, including the first-ever default in the onshore debt market and payment warnings. The CSI CB index hit a three-year low in September, while the years-long property crisis in China also loomed over the broader credit market. But Beijing's stimulus blitz in mid-September that helped revive the stock market also jumpstarted convertibles' rebound that has largely kept up. The CSI CB index ended 2024 about 6% higher, thanks to a rally late in the year. Some convertibles with riskier ratings also may be looking more attractive given the pool of options for high-yield chasers is narrowing in China. Two issuers rated junk last year — D&O Home Collection Group Co. and Zhangjiagang Guangda Special Material Co. — have seen their bonds nearly double from midyear months in 2024. 'China high yield space has shrunk materially in the past few years,' said Christopher Li, head of Asia credit trading desk analysts at BNP Paribas. A limited supply of new issues could also help sustain the CB market momentum, Lv Pin, chief fixed income analyst at Topsperity Securities Co., said. Issuance slumped to 38.4 billion yuan ($5.3 billion) in 2024, the lowest in eight years, as authorities began cracking down on who's qualified to issue such debt. 'Credit risk, which triggered a previous selloff across the board, has been mitigated gradually,' Lv said. The Undocumented Workers Who Helped Build Elon Musk's Texas Gigafactory The Unicorn Boom Is Over, and Startups Are Getting Desperate Japan Perfected 7-Eleven. Why Can't the US Get It Right? The NBA Has Fallen Into an Efficiency Trap How Silicon Valley Swung From Obama to Trump ©2025 Bloomberg L.P.
Bloomberg
18-02-2025
- Business
- Bloomberg
Chinese Convertible Bonds Entice Investors Extending AI Bets
Chinese investors' zeal for artificial intelligence-related assets fanned by DeepSeek has spread to convertible bonds, sending a benchmark index to its highest in more than two years. The CSI Convertible Bond Index has risen 3.3% this year, hitting its highest since August 2022 on Tuesday and tracking gains in the stock benchmark gauge. Shanghai Runda Medical Technology Co. and Thalys Medical Technology Group, two of the companies expected to benefit from AI integration, have seen their convertibles soar more than 22% and 16%, respectively, this year.
