Hedge funds still park on the US short-term treasury bonds recently, because the issues of economic downturn and unemployment rate are getting clear- economic slump remains 20 months at least. Therefore, even the number of issuing bonds is increasing; it does not affect bond holder’s confidence. For the expectation this week, the US 10year treasury bond rate will be in a range between 3.30%~4.0%.

　　 No major events or economic indexes impact yield trends this week. It is expected that investors will be more conservative and restricted because yield rates decreased dramatically and the volume has not been increasing. The key point to influence A97106 is the trend of the when-issue of 975R (11/18). IF the trend performs better than the expectation, the yield rate of A97106 will test the barrier 1.60%, otherwise it might rebound to 1.80%. Basically 975R and A97106 will be traded in a range until insurance companies make their investing direction clear. For the expectation this week, A97106 will be traded in the range of 1.60%~1.80%.

　　 This week, the factors influence the money market is treasury D/R maturity of NT$5546.55 bn. The tighten factors in this week is opening market operation from central bank. Rates decreased dramatically because the unpredictable rate cutting. We believe 30days C/P rate will traded between 1.60%~1.62%. RP rate for the Government bonds is believed to decrease to the range 1.35%~1.38% this week.

　　 IBTS estimates that the convertible bonded parity ranges were 80-130. Recommend Far eastern textile-E1(140201), which is linked to Asia cement. Asia cement has developed successfully for years in Taiwan and China, hence we believe it will be benefited by the policy of increasing domestic demands of China. It’s EPS achieved NTD$2.36 until Q3, we estimate it will be around NTD$3.16 at the end of this year. The convertible price is now NTD$ 51.77, the current price of convertible bonds now is NTD $91.6, yield rate is 5.5%, hence the target price we recommend to buy is under NTD $92.