India Corporate Bonds
Yields steady on caution before US election outcome
This story was originally published at 21:53 IST on 4 November 2024
Register to read our real-time news.Informist, Monday, Nov. 4, 2024
By Ashna Mariam George
MUMBAI – Yields on corporate bonds in the secondary market ended steady across tenures on Monday as investors refrained from placing large bets ahead of the US presidential election scheduled for Tuesday, dealers said.
"The market was shallow today because the big event of the US election is impending. The market is looking at how the US Treasury yields will react to the election results," a dealer at a mid-sized private sector bank said. "There is no impact directly, but in a world where yields are so intertwined, US yields will possibly impact our government security yields and thereby corporate bond yields. People just want it (US Presidential election) to be out of the way before they make up their minds about trading."
The Republican candidate and former president Donald Trump and Democratic nominee and Vice-President Kamala Harris are in a close tie to win the election on Tuesday. According to the latest poll conducted by the New York Times, neither candidate has a polling lead in enough states to reach 270 electoral votes. Across the seven swing states that are likely to decide the results, the polls are so remarkably close that neither candidate has a meaningful edge in the final stretch.
Subdued market participation after the Diwali holidays also kept the yields steady, dealers said. "Today, market was bit dead on secondary side as many people are still on leave," a dealer at a mid-sized brokerage firm said. "Probably, people will be back in market on US election result day - so effectively on Nov. 6. Though elections won't have much direct impact, people are cautious."
In the secondary market, buying and selling activity was observed in small amounts, without a significant effect on yields. Mutual funds were said to be active on selling side, while banks were seen on buying side, dealers said. On Monday, trade volume rose in the secondary market, with deals worth INR 100.04 billion being recorded on the National Stock Exchange and BSE combined, against INR 36.14 billion on Thursday.
Papers issued by the National Bank for Agriculture and Rural Development, Power Finance Corp., Power Grid Corp. of India, Export Import Bank of India, State Bank of India, and Bajaj Finance were traded the most on the exchanges.
The activity in the primary market of corporate bonds was moderate on Monday, dealers said. On Tuesday, India Infrastructure Finance Co will tap the market to raise up to INR 30 billion through two bonds of different maturities. Aditya Birla Housing Finance has also invited bids on Tuesday to raise up to INR 7.35 billion through bonds maturing on Aug. 6, 2029.
UDAY BONDS
No Ujjwal DISCOM Assurance Yojana bonds were traded in the secondary market on Thursday, according to the Reserve Bank of India's Negotiated Dealing System–Order Matching System.
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURE | MONDAY | THURSDAY |
Three-year | 7.48-7.50% | 7.47-7.49% |
Five-year | 7.42-7.45% | 7.43-7.45% |
10-year | 7.24-7.26% | 7.23-7.27% |
End
With input from Vaishali Tyagi
Edited by Akul Nishant Akhoury
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2024. All rights reserved.
To read more please subscribe
Share this Story:
