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Our Bureau

Mumbai, Aug. 9

Bond prices rose by around 70 paise reacting to the pause in the hike in interest rates by the US Fed. The traded volume on the order matching system was high at Rs 4,405 crore. Dealers said that sentiment was positive also because the Rs 9,000 crore auction held on Tuesday was well-bid for.

"There was a feel-good factor in the market as was evident in the heavy participation today. But the rally will not last for long," said a dealer at a private bank. Market participants expect the 10-year yield to stabilise at 8.15 per cent. However, the Rs 8,000 crore auction between August 14 and 22 will pull prices down again, they said. The 7.59 per cent-10 year-2016 paper opened at Rs 96.25 (8.15 per cent YTM) and closed at Rs 96.50 (8.12 per cent YTM), up from Tuesday's Rs 95.99 (8.19 per cent YTM). The 9.39 per cent-5 year-2011 paper opened at Rs 106.31 (7.81 per cent YTM) and ended at Rs 106.60 (7.74 per cent YTM), against Tuesday's close at Rs 106.2 (7.84 per cent YTM).

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