Muted morning trading gives way to post-auction activity

By First Capital Research

Yesterday the secondary market remained rather dormant during the early hours of trading, however activity picked up following the T-bond auction. 

Post-auction activity saw buying interest particularly for the 2029 and 2031 maturities. However, overall trading volumes were moderate. 

The T-bond auction held yesterday came to a close with the initially offered amount of Rs.35.0 billion being raised through the 2029 maturity, for which the weighted average yield stood at 10.22 percent. Likewise, Rs.45.0 billion was raised via the 2033 maturity, for which the weighted average yield stood at 10.97 percent.

Prior to yesterday’s T-bond auction, the 01.07.2028 maturity traded at 9.85 percent while the 15.10.2028 and 15.12.2028 maturities traded at 9.90 percent and 9.95 percent, respectively. Following the conclusion of the T-bond auction, the 15.06.2029 maturity traded at 10.15 percent, 15.09.2029 at 10.18 percent and 15.12.2029 at 10.25 percent. Moving further ahead on the yield curve, the 15.03.2031 maturity traded at 10.65 percent and finally the 01.11.2033 maturity traded at 10.88 percent. 

In the forex market, the Sri Lankan rupee appreciated against the greenback, ending the day at Rs.299.3/US dollar, in comparison to the previous day’s Rs.299.5/US dollar. Meanwhile, overnight liquidity in the banking system expanded to Rs.194.5 billion, from Rs.163.4 billion seen in the previous session.