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Daily report for the 11th November 2024 – Courtesy Wealth Trust Securities Ltd
- Secondary Bond Market Starts Off Bullish
- Rs 132.50 Bn T-bond Auction in Focus
- Rupee Marginally Depreciates
The bond market started off the new trading week on a bullish note, with yields continuing to decline. Trading activity and transaction volumes were seen at healthy levels in the morning, but slowed down latterly as market participants exercised caution ahead of the upcoming Treasury Bond auction.
The 15.12.27 maturity was seen trading at the rate of 11.30%. The yield on the 15.02.28/15.03.25 maturities declined further to trade within the range of 11.55%-11.54%. The relatively longer tenor 2028 maturities of 15.10.28 and 15.12.28 were seen trading at the rates 11.75% and 11.80% respectively. Additionally, trades were observed on the medium tenor 15.06.29, 15.05.30 and 01.10.32 maturities were seen changing hands at the rates of 11.95%, 12.16%-12.15%, 12.31%-12.30% respectively.
This comes ahead of the upcoming Rs 132.50 billion Treasury Bond auction due Today (the 12th of November). The auction will have on offer Rs 85.00 billion from a 01st May 2028 maturity bearing a coupon of 09.00% and Rs 47.50 billion from a 01st of October 2032 maturity bearing a coupon rate of 09.00%.
For context, the previous Rs. 32.50 billion Treasury Bond auction conducted on the 28th of October, recorded a bullish outcome. A 15.10.28 maturity (bearing a 11.00% coupon) was issued at a weighted average yield of 11.84%. In addition, a 01.06.33 maturity (bearing a 9.00% coupon) was issued at a weighted average rate of 12.36%. The auction overall saw total bids received exceed the offered amount by 3.82 times and the entire Rs 32.50 billion successfully raised across both phases. In addition, Rs. 2.00 billion, being the maximum amount offered, was raised out of a total market subscription of Rs. 4.00 billion via the Direct Issuance Window on the 2028 tenor.
The total secondary market Treasury bond/bill transacted volume for 08th November was Rs. 17.51 billion.
In money markets, the weighted average rates on overnight call money and Repo stood at 8.54% and 8.63% respectively. The DOD (Domestic Operations Department) of Central Bank injected liquidity by way of an overnight repo auction for Rs. 8.57 billion at the weighted average rate of 8.39%.
The net liquidity surplus stood at Rs. 162.93 billion yesterday. An amount of Rs 0.05 billion was withdrawn from the Central Banks SLFR (Standing Lending Facility Rate) of 9.25%, while an amount of Rs. 171.54 billion was deposited at Central Banks SDFR (Standard Deposit Facility Rate) of 8.25%.
Forex Market
In the Forex market, the USD/LKR rate on spot contracts closed the day depreciated slightly at Rs. 292.65/292.75 against its previous day’s closing level of Rs. 292.50/292.65.
The total USD/LKR traded volume for 08th November was US $ 26.08 million.
(References: Central Bank of Sri Lanka, Bloomberg E-Bond trading platform, Money broking companies)