Cash-rich fund managers keen to recoup losses after Europe’s sovereign debt crisis will drive Asian corporate bond prices higher during the traditional August lull, even as borrowers rush to exploit demand, said Aberdeen Asset Management Asia Ltd.
Billionaire Li Ka-shing ’s Hutchison Whampoa Ltd. , Noble Group Ltd. and other Asian companies are selling a record amount of bonds with no fixed maturities as investors in search of higher yields buy riskier securities.
Reliance Industries Ltd. bondholders are shrugging off signals by the energy company that it will add more debt and are instead focusing on the potential for rising oil prices to bolster its creditworthiness.
India and China are poised to become the first emerging markets in Asia to trade credit-default swaps on local-currency debt as investors seek protection against losses from funding projects in the region’s fastest-growing economies.
Borrowing costs for India’s power, road and rail companies fell to a three-month low after the government lifted limits on foreign investment, directing global funds to infrastructure projects for the first time.
Emerging-market borrowers completed the busiest ever start to a year, selling $197 billion of bonds on international markets to secure funding while interest rates in the U.S. and Europe stay at all-time lows.