Date:06/09/2007 URL: http://www.thehindubusinessline.com/2007/09/06/stories/2007090651350600.htm

Back Bond market weakens

Mumbai, Sept 5

The bond market was weak as there was no lack of clarity on the liquidity situation. The cut-off yields of the 91 and 180 days Treasury-bills, which were auctioned today, also did not affect the market. The T-bills yields were a bit higher than market expectations, said dealers. Bond yields ended about one basis points higher than Tuesday’s close. There is a fear among most participants that liquidity would be under pressure due to the advance tax payments, which wou ld start in about 10 days, said a bond dealer with a private bank. However, bond prices are likely to move up on Thursday and Friday, as inflation figures are expected to be lower, the dealer said.

The 7.49 per cent 10-year 2017 paper opened at Rs 97.14 (7.91 per cent YTM) and closed at Rs 97.07 (7.93 per cent YTM) against the previous close of Rs 97.15 (7.92 per cent YTM). The 7.99 per cent 10-year 2017 paper opened at Rs 10.66 (7.88 per cent YTM) and closed at Rs 100.55 (7.91 per cent YTM) against the previous close of Rs 100.67 (7.89 per cent YTM).

— Our Bureau