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“Wednesday‚ Thursday and Friday were busy days for US treasuries and bond yields went up around the globe and this has triggered a sell-off in our market‚” a local trader said.
“Economic data out of China and Asia has been weaker than expected‚ with a possibility of central bank monetary easing intervention and one would have expected a downward spiral in bonds‚ but instead they have gone up. The curve continues to flatten‚” he added.
US retail sales and eurozone second quarter gross domestic product data are out on Tuesday‚ and South African June retail sales figures on Wednesday - data that could determine the direction for bonds.
At 3.49pm‚ the benchmark R157 bond was trading at 5.655% from Friday’s close of 5.620%‚ R207 was bid at 6.640% and offered at 6.615% from its previous close of 6.585% and the R186 was trading at 7.425% from its previous close of 7.395%.
Meanwhile US treasuries edge lower in continued light volume on Monday‚ and analysts pinned it on supply-and-demand dynamics more so than any piece of economic news‚ Dow Jones Newswires reported.
But perhaps Italy's decently received debt auction and Greece's less-than-expected GDP contraction presented a case against safe-haven treasuries for the time being.
Foreigners were net buyers of R3.248bn of South African bonds including repo transactions on Friday after net sales of R1.252bn of local bonds on Wednesday‚ data released by the JSE shows.
Local markets were closed on Thursday for a public holiday.
Nominal cumulative volume was R41.225bn on Friday from R48.348bn on Wednesday.
Foreigners were net sellers of R391.622m of local bonds excluding repo transactions on Friday after net sales of R1.283bn of local bonds on Wednesday.
For the year to date foreigners have been net buyers of R66.338bn of local bonds‚ excluding repo transactions. In 2011 they were net buyers of R47.359bn worth of local bonds‚ excluding repo transactions.
In the year to date foreigners have been net buyers of R67.739bn of local bonds including repo transactions. In 2011 they bought R37.501bn worth of local bonds.
