Informist, Thursday, Dec 15, 2022
By Parth Singh
NEW DELHI – Yields on corporate bonds ended steady today in the secondary market as investors were engaged only in requirement-based trading after the 50-basis-points rate hike by the US Federal Reserve was on expected lines, dealers said.
"Investors had already factored in that the US Fed is going to hike the interest rate by half a basis point, so there was not much of a surprise in the market," a fund-manager with a mid-sized brokerage firm said.
The US Fed hiked the interest rate by 50 bps to a target range of 4.25-50%, after four straight hikes of 75 bps each this year.
After the US consumer price inflation index came in at 7.1%, market participants were expecting the US Federal Open Market Committee to hike interest rates by 50 bps. Earlier this month, Fed Chairman Jerome Powell had hinted at softer rate hikes as inflation has started to cool down.
On Wednesday, however, Powell indicated that the Fed would keep raising rates next year as well until it reaches its 2% target on retail inflation.
"Currently yields on both short-term and long-term papers are flattish," a dealer said.
Mainly insurance companies were active on the buying side while mutual funds were buying as well as selling, dealers said.
Bonds issued by GMR Hyderabad International Airport, Axis Bank, National Bank for Agriculture and Rural Development, Bharti Telecom, State Bank of India, IDFC First Bank, and ICICI Bank were traded the most across tenures.
Volume in the secondary market remained lacklustre. Deals aggregating 42.13 bln rupees were recorded on the National Stock Exchange as against 47 bln rupees on Wednesday. BSE clocked deals worth 20.72 bln rupees against 39 bln rupees on Wednesday.
In the primary market, several state-owned entities this week raised 41.9 bln rupees cumulatively under the Bharat Bond Exchange-Traded Fund. The coupons on the bonds ranged from 7.44% to 7.58%.
"All the Bharat Bond issuances this week had a minimal amount, so they got subscribed within a similar range," a dealer said.
Housing and Urban Development Corp raised 4.7 bln rupees at a coupon of 7.52%. Its issue was fully subscribed.
According to merchant bankers, Nuclear Power Corp of India plans to raise funds through bonds maturing on Apr 15, 2033. The state-owned entity may invite bids for the issue next week.
On Friday, Power Finance Corp plans to tap the market to raise up to 65 bln rupees through two bonds, one maturing on Dec 19, 2037 and the other on Dec 17, 2028. Last week, Informist exclusively reported that PFC will tap the market soon with a bond issue of up to 25 bln rupees.
Gas Authority of India plans to raise up to 25 bln rupees on Friday through unsecured bonds maturing on Dec 20, 2027.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating 50.19 bln rupees were traded at a weighted average yield of 7.48-7.55%, data from the RBI's Negotiated Dealing System – Order Matching System showed.
* 21.80 bln rupees of Haryana's 2026 bonds were traded at 7.52%
* 12.39 mln rupees of Haryana's 2025 bonds were traded at 7.48%
* 10 mln rupees of Rajasthan's 2026 bonds were traded at 7.49%
* 6 mln rupees of Rajasthan's 2024 bonds were traded at 7.55%
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURES | TODAY | WEDNESDAY |
Three-year | 7.47-7.53% | 7.45-7.50% |
Five-year | 7.49-7.54% | 7.48-7.52% |
10-year | 7.55-7.60% | 7.55-7.60% |
End
Edited by Ashish Shirke
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 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2022. All rights reserved.
Informist, Thursday, Dec 15, 2022
By Parth Singh
NEW DELHI – Yields on corporate bonds ended steady today in the secondary market as investors were engaged only in requirement-based trading after the 50-basis-points rate hike by the US Federal Reserve was on expected lines, dealers said.
"Investors had already factored in that the US Fed is going to hike the interest rate by half a basis point, so there was not much of a surprise in the market," a fund-manager with a mid-sized brokerage firm said.
The US Fed hiked the interest rate by 50 bps to a target range of 4.25-50%, after four straight hikes of 75 bps each this year.
After the US consumer price inflation index came in at 7.1%, market participants were expecting the US Federal Open Market Committee to hike interest rates by 50 bps. Earlier this month, Fed Chairman Jerome Powell had hinted at softer rate hikes as inflation has started to cool down.
On Wednesday, however, Powell indicated that the Fed would keep raising rates next year as well until it reaches its 2% target on retail inflation.
"Currently yields on both short-term and long-term papers are flattish," a dealer said.
Mainly insurance companies were active on the buying side while mutual funds were buying as well as selling, dealers said.
Bonds issued by GMR Hyderabad International Airport, Axis Bank, National Bank for Agriculture and Rural Development, Bharti Telecom, State Bank of India, IDFC First Bank, and ICICI Bank were traded the most across tenures.
Volume in the secondary market remained lacklustre. Deals aggregating 42.13 bln rupees were recorded on the National Stock Exchange as against 47 bln rupees on Wednesday. BSE clocked deals worth 20.72 bln rupees against 39 bln rupees on Wednesday.
In the primary market, several state-owned entities this week raised 41.9 bln rupees cumulatively under the Bharat Bond Exchange-Traded Fund. The coupons on the bonds ranged from 7.44% to 7.58%.
"All the Bharat Bond issuances this week had a minimal amount, so they got subscribed within a similar range," a dealer said.
Housing and Urban Development Corp raised 4.7 bln rupees at a coupon of 7.52%. Its issue was fully subscribed.
According to merchant bankers, Nuclear Power Corp of India plans to raise funds through bonds maturing on Apr 15, 2033. The state-owned entity may invite bids for the issue next week.
On Friday, Power Finance Corp plans to tap the market to raise up to 65 bln rupees through two bonds, one maturing on Dec 19, 2037 and the other on Dec 17, 2028. Last week, Informist exclusively reported that PFC will tap the market soon with a bond issue of up to 25 bln rupees.
Gas Authority of India plans to raise up to 25 bln rupees on Friday through unsecured bonds maturing on Dec 20, 2027.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating 50.19 bln rupees were traded at a weighted average yield of 7.48-7.55%, data from the RBI's Negotiated Dealing System – Order Matching System showed.
* 21.80 bln rupees of Haryana's 2026 bonds were traded at 7.52%
* 12.39 mln rupees of Haryana's 2025 bonds were traded at 7.48%
* 10 mln rupees of Rajasthan's 2026 bonds were traded at 7.49%
* 6 mln rupees of Rajasthan's 2024 bonds were traded at 7.55%
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURES | TODAY | WEDNESDAY |
Three-year | 7.47-7.53% | 7.45-7.50% |
Five-year | 7.49-7.54% | 7.48-7.52% |
10-year | 7.55-7.60% | 7.55-7.60% |
End
Edited by Ashish Shirke
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 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2022. All rights reserved.
