Bullish sentiment continues in secondary bond markets
Tuesday, 8 July 2014 00:13
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By Wealth Trust Securities
The week commenced with continued buying interest along the yield curve as yields on the market favorite durations of 1 July 2019, 1 May 2021, 1 July 2022 and 1 January 2024 were seen dipping in morning hours of trading to intraday lows of 8.03%, 8.70%, 9.00% and 9.30% respectively yesterday.
However, profit taking at these levels curtailed any further downward movement as activity remained high once again.
In addition, a limited amount of activity was witnessed on the shorter end of the curve as well, with the three year maturity of 15 May 2017 changing hands within the range of 7.33% to 7.39% and the two 2018s (i.e. 1 April 2018 and 15 August 2018) within the ranges of 8.82% to 8.86% and 8.90% to 8.95% respectively.
Meanwhile on secondary bill markets, May 2014 bills were seen changing hands within the range of 6.80% 6.85% while the 364 day bill was quoted at levels of 6.90/95.
In money markets, overnight call money and repo rates remained steady to average 6.96% and 6.54% respectively yesterday as surplus liquidity increased to Rs. 34.39 billion. The Open Market Operations (OMO) department of Central Bank was seen conducting a four-day term Repo auction yesterday at where a total amount of Rs. 10.0 b was drained out at a weighted average of 6.61%.
Rupee remains steady
Meanwhile in Forex markets, the USD/LKR rate was seen closing the day steady at Rs. 130.26/28 yesterday as markets were at equilibrium. The total USD/LKR traded volumes for 4 July 2014 stood at $ 141.60 million.
Some of the forward dollar rates that prevailed in the market were one month – 130.56; three months – 131.18 and six months – 132.21.
