The Hindu Business Line : Bonds slump by 70 paise

Bond prices plummeted by around 70 paise on heavy selling in anticipation of a higher inflation number announcement on Friday. Total traded volumes on the order matching system were at Rs 3,365 crore (Rs 2,285 crore).

Dealers said that they expected domestic inflation to be higher at 9.75 per cent for the week-ended June 7, against 8.75 per cent in the previous week. The sentiment was also bearish as there is a scheduled Rs 6,000 crore government security auction on Friday.

“The securities being auctioned are obscure and there is not much of buying interest. The higher than expected underwriting commission also signifies the bearish mood,” said a dealer at a private bank.

The 8.24 per cent -10 year-2018 benchmark paper opened at Rs 99 (8.39 per cent YTM) and closed at Rs 98.45 (8.47 per cent YTM), against the previous close at Rs 99.13 (8.37 per cent YTM). The 6.57 per cent -3 year-2011 paper opened at Rs 95.70 (8.39 per cent YTM) and closed at Rs 95.20 (8.61 per cent YTM). – Our Bureau

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