GoI borrowing number eyed, sentiment remains jittery: Edelweiss,

Please Share:: India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��


GoI borrowing number eyed, sentiment remains jittery
Government securities
 Bond yields saw a rise across maturities as sentiment remains jittery ahead of the
government borrowing announcement. Market participants opted to trim their
holdings on expectation of a higher than estimated borrowing number for FY12
owing to a higher subsidy bill and slower than expected disinvestment process.
Weekly inflation also rose after two weeks of sharp fall which weighed in on the
sentiment. Despite a fall in the food articles index, the primary articles index
edged higher mainly on account of the rise in prices of non food articles like fibres
& rubber.
Non-SLR market
 CD issuances continued to be strong as bank’s raised funds to meet the gap
between the credit and deposit growth. Short term rates continue to stay above
the 10% level and may tighten further due to the high rollover from banks and
outflow of advance taxes in March. Banks mopped up INR 45bn today compared
to INR 35bn on Wednesday.
 Axis Bank & ING Vysya Bank placed INR 8.50bn and INR 10bn of three month CD
at 10.25% while Canara Bank placed INR 3bn at 10.08%. BOI and BOB placed INR
6.25bn and INR 2.50bn of one year CD at 10.15% while IDBI Bank placed same
maturity CD at 10.19% for a quantum of INR 2.30bn. PFC raised INR 10bn
through CP maturing in three months at 9.85%.
Money markets
 LAF borrowing remained stable around the INR 725bn mark due to the waning
demand for funds towards the end of the reporting cycle. Call rates ended at
6.72% while the CBLO rates ended unchanged at yesterday’s level of 6.49%.