Subdued Trend Ahead

GILTS & BONDS Market

The wholesale debt market at the National Stock Exchange is expected to witness subdued activity this week. Turnover was substantially lower at Rs 1178.71 crore last week as against Rs 3054.34 crore the week before. Average turnover amounted to Rs 286.84 crore against Rs 509.06 crore in the previous week.

The interbank rates opened in the range of 0.25 per cent last week and moved up to 9.5 per cent levels on account of the state loan subscriptions by the end of the week. Dealers feel that call rates will rule in the region of 6 per cent.

 

Last week the prices of all major securities reacted on selling pressure and sought lower levels. The most actively traded security was the 13.50 per cent government loan, maturing 1997, which was traded for Rs 350 crore at 10.08 per cent. There was increased activity in medium-term government securities after the announcement of a 5 year government loan.Cut-off yield expectations are in the 12.50 -12.70 per cent range. During the week T-bills saw dull trading for an amount of Rs 76.50 crore.