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Johannesburg - South African bonds gained up to six basis points in midday trade on Thursday, receiving a fillip from the strong local currency.
By 11:45, the benchmark R157 bond was trading at 7.580% from its previous close of 7.640%. The R207 was bid at 8.330% and offered at 8.415% from 8.400% and the R186 was trading at 8.530% and offered at 8.600% from 8.615%.
The rand was bid at 6.9184 to the dollar from its previous close of 6.9019.
"We're firmer and it's purely on the back of the currency. In terms of levels, 7.57 has been difficult for the R157s to get through - it should hold. Guys might try to push it lower during lunchtime though," said a local trader.
Earlier, Standard Bank said in a report that solid gains in the rand should encourage follow-through in bonds.
"After Tuesday's favourable data flow, South African interest rates could continue to compress against a supportive external backdrop. Domestic drivers are set to be of limited importance today, with only second-tier data scheduled for release," they said.
Meanwhile, the National treasury announced that it would auction one billion rand worth of R203 bonds and R1.1bn worth of R207 bonds on May 24.
Foreigners were net buyers of R495.074m of South African bonds including repo transactions on Tuesday after net sales of R594.737m of local bonds on Monday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R58.753bn on Tuesday from R144.162bn on Monday.
Foreigners were net buyers of R492.959m of South African bonds excluding repo transactions on Tuesday after net sales of R600.557m of local bonds on Monday.
For the year to date, foreigners have been net buyers of R19.859bn worth of local bonds, excluding repo transactions. In 2010 foreigners bought net R57.064bn worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net buyers of R12.038bn of local bonds. In 2010 they bought net R44.541bn worth of bonds.
By 11:45, the benchmark R157 bond was trading at 7.580% from its previous close of 7.640%. The R207 was bid at 8.330% and offered at 8.415% from 8.400% and the R186 was trading at 8.530% and offered at 8.600% from 8.615%.
The rand was bid at 6.9184 to the dollar from its previous close of 6.9019.
"We're firmer and it's purely on the back of the currency. In terms of levels, 7.57 has been difficult for the R157s to get through - it should hold. Guys might try to push it lower during lunchtime though," said a local trader.
Earlier, Standard Bank said in a report that solid gains in the rand should encourage follow-through in bonds.
"After Tuesday's favourable data flow, South African interest rates could continue to compress against a supportive external backdrop. Domestic drivers are set to be of limited importance today, with only second-tier data scheduled for release," they said.
Meanwhile, the National treasury announced that it would auction one billion rand worth of R203 bonds and R1.1bn worth of R207 bonds on May 24.
Foreigners were net buyers of R495.074m of South African bonds including repo transactions on Tuesday after net sales of R594.737m of local bonds on Monday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R58.753bn on Tuesday from R144.162bn on Monday.
Foreigners were net buyers of R492.959m of South African bonds excluding repo transactions on Tuesday after net sales of R600.557m of local bonds on Monday.
For the year to date, foreigners have been net buyers of R19.859bn worth of local bonds, excluding repo transactions. In 2010 foreigners bought net R57.064bn worth of local bonds, excluding repo transactions.
For the year to date for total transactions, including repo transactions, foreigners have been net buyers of R12.038bn of local bonds. In 2010 they bought net R44.541bn worth of bonds.
