The Hindu Business Line : Bonds gain in volatile trade

Bond prices gained by 40 paise in highly volatile trading, said bond dealers. Prices were under steady pressure before the auction announcement, said a dealer with a private bank. The RBI announced the auction of two government securities for Rs 10,000 crore. This additional supply of bonds is expected to tighten liquidity in the system.

However, the easing in oil prices and sufficient liquidity in the system helped reduce the pressure on bond prices to some extent, added the dealer. Crude oil prices were hovering at $123 per barrel.

Total traded volumes on the order matching system were at Rs 4,180 crore (Rs 3,630 crore). The 8.24 per cent-10 year-2018 paper opened at Rs 93.30 (9.29 per cent YTM) and touched an intra day high of Rs 94.35 (9.12 per cent YTM). It finally closed at Rs 93.57 (9.25 per cent YTM) against the previous close of Rs 93.17 per cent (9.32 per cent YTM). The second highly traded security, the 9.39 per cent-3 year-2011 paper opened at Rs 100.14 (9.32 per cent YTM) and closed at Rs 100.2 (9.30 per cent YTM). –

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