Informist, Monday, Dec 13, 2021
By Aayushi Parekh and Sanjana Raina
MUMBAI – Yields on corporate bonds moved in a thin range today amid low volumes as traders await consumer price index inflation data, scheduled to be released after market hours today, dealers said.
"Today, traders were eyeing the inflation print. Anything around or above 5.25% will trigger sell-offs in the corporate bond market," a dealer with a bank said.
India's headline retail inflation rate is seen rising to a three-month high of 5.1% in November from 4.48% in October, according to 23 economists polled by Informist.
Last week's cues from RBI's policy meeting have not spilled over into this week, a fund manager said. However, most investors are staying on the sidelines ahead of the US Federal Reserve's Policy meeting outcome, scheduled for Wednesday.
Bonds issued by Housing Development Finance Corp, Indian Railway Finance Corp, NTPC Ltd, LIC Housing Finance, National Bank For Agriculture and Rural Development, Punjab National Bank, REC and Piramal Capital and Housing Finance were traded the most today.
"There was little to no activity today since there are no significant cues. The trade volumes fell too," a dealer with an insurance company said.
Till 1500 IST, trade volumes reported on the National Stock Exchange aggregated 11.33 bln rupees as against 22.89 bln rupees on Friday.
Insurance companies were said to be on the selling side today while mutual funds participated in both buying and selling. However, both entities traded in small quantums, dealers said.
According to merchant bankers, the supply of primary issuances will increase in the coming days with a huge chunk of bids reserved for the latest tranche of Bharat Bond Exchange-Traded Funds.
On Tuesday, in the primary market, bonds worth at least 23.8 bln rupees are lined up for sale.
NABARD and REC plan to raise up to 10 bln rupees, and 13.8 bln rupees, respectively, through bonds maturing on Apr 14, 2032, and Mar 20, 2032.
The greenshoe amount of the both issuances is reserved for Bharat Bond Exchange-Traded Fund.
Today, deals aggregating 30.49 bln rupees were reported on the National Stock Exchange against 42.40 bln rupees on Friday. BSE recorded deals worth 20.83 bln rupees compared with 22.31 bln rupees in the previous session.
UDAY BONDS
In the secondary market, no Ujjwal DISCOM Assurance Yojana bonds were traded, data from the RBI's Negotiated Dealing System – Order Matching System showed.
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURES | TODAY | FRIDAY |
Three-year | 5.38-5.42% | 5.37-5.42% |
Five-year | 5.68-5.71% | 5.67-5.70% |
10-year | 6.80-6.82% | 6.80-6.83% |
End
Edited by Avishek Dutta
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