Hectic Trading Likely

GILTS & BONDS MARKET

The week ahead is expected to witness buoyant trading activities in the debt market segment of the National Stock Exchange (NSE). The market was upbeat on Saturday as government securities prices appreciated by 10-40 paise. Says a nationalised bank dealer the gilts market will attract buying from the banking segment as appetite for government paper will increase. This is because the budget has made the sovereign paper more attractive by injecting fiscal incentive.

That apart, removal of tax deductions at source or the voucher element has removed the speculative fizz as well as unevenness in gilts trades, he said.

 

Trading volumes on Saturday, March 1, stood at Rs 211.30 crore while the total traded volumes for the week amounted to Rs 1489.78 crore. The liquidity in the market is expected to remain good with net inflows of Rs 3,000 crore expected today (Monday), following the reversal of the Reserve Bank of India's repos auction. The repos scheduled for this week are not expected to draw much money out of the system as the repo-rate is only 5 per cent whereas yields on gilts are higher.Calls are expected to rule in the region of 5-7 per cent.