The yield on the ten-year benchmark 7.38 per cent 2015 closed at a high of 6.82 per cent on Wednesday as against a close of 6.73 per cent on Tuesday. | |
| Heavy selling by a private bank triggered the price fall, said a dealer. Bearish sentiment, led by a huge government borrowing programme and a global rise in interest rates, pulled the market down. |
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| Though there is a fresh appetite to buy securities, no major buying is actually happening, a dealer said. This is because, after buying securities there is no avenue for offloading the papers. Most of the banks already have trading losses. |
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| The foreign exchange market remained rangebound with the spot rupee opening at 43.77/78 and closing a tad higher at 43.75/76 to a dollar. There has been frantic covering in near term forward dollars. Corporates are cancelling export contracts and realising the proceeds. |
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| Oil is another major concern as its price shows no signs of mellowing down, a dealer added. |
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| The corporate bonds market has turned illiquid with widening spreads between gilts and corporate papers. |
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| Earlier on Tuesday, the Rs 8,000 crore maiden auction of government borrowing programme in the new fiscal sailed through with the Reserve Bank of India receiving bids for more than double the amount at Rs 16,738 crore. |
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| The cut-off price of the shorter 7-year paper came in tune with market expectations, while that on the 27-year paper was below market expectations. |
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| The cut-off price for the 6.85 per cent 2012 paper came at Rs 100.25 with the cut-off yield at 6.8045 per cent in tune with market expectations. |
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| The Rs 5,000 crore auction of the 6.85 per cent 2012 paper received a good response of Rs 10,755 crore in the market. After the auction, the price of the otherwise illiquid paper fell to Rs 100.40 from Monday's levels of Rs 100.70. |
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| The cut-off price for the other auction paper, the 7.95 per cent 2032 paper came at Rs 101.75 and a yield of 7.7934 per cent, while the market price expectation was higher at 102.40-103.00. The Rs 3,000 crore worth of paper received bids worth Rs 5,983 crore. |
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| Bond prices in the market were rangebound today with the ten-year benchmark, 7.38 per cent 2015 paper closing at Rs 104.65 and a yield of 6.75 per cent unchanged from Monday's closing level. |
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| The higher government borrowing programme for the first half of the new financial year 2005-06 had sent jitters across the Indian debt markets. At Rs 83,000 crore the borrowing programme in the first half of the next fiscal year is 41 per cent higher than first half of the previous year. The month of April itself will witness auction of government papers worth Rs 15,000 crore. |
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