Bonds little changed; eye auction

Johannesburg - South African bond yields were little changed from their overnight levels in early trade on Tuesday, ahead of the weekly government bond auction.

By 08:50 the benchmark R157 bond was bid at 7.275% from 7.270% at its close on Monday. The benchmark R207 was bid at 7.985% and offered at 7.955% from 7.965%, while the R186 was bid at 8.045% and offered at 8.015% from 8.030%.

The rand was bid at R7.2347 to the dollar from R7.2195 at its previous close.

"We're pretty much in line with yesterday's close. Trade is quite thin at the moment. All eyes are on the auction a bit later, I suspect the R207s will be better bid relative to the R203s," said a local trader.

The National Treasury will auction R1.1bn worth of R203 bonds and R1.0bn worth of R207 bonds at its weekly auction this morning at 11:00.

Foreigners were net sellers of R798.542m of South African bonds including repo transactions on Monday, after net purchases of R752.653m of local bonds on Friday, Bond Exchange of South Africa statistics show.

Nominal cumulative volume was R33.526bn on Monday from R39.395bn on Friday.

Foreigners were net sellers of R800.613m of South African bonds excluding repo transactions on Monday after net purchases of R769.782m of local bonds on Friday.

In the year to date foreigners have been net buyers of R71.075bn worth of local bonds, excluding repo transactions.

So far for total transactions, including repo transactions, foreigners have been net buyers of R63.603bn worth of bonds.

In 2009 foreigners were net buyers of R27.755bn worth of local bonds, excluding repo transactions, while for total transactions, including repo transactions, foreigners were net sellers of R2.424bn worth of bonds.