South African bonds opened stronger in quiet early trade on Monday on the back of a firmer rand after South Africa on Saturday won the right to host the 2010 Soccer World Cup.
At 9am the benchmark six-year R153 bond was at 10,100% from 10,140% at Friday’s close, 10,24% at Thursday’s close, 10,120% at Wednesday’s close and 10,09% at Tuesday’s close. The five-year R194 bond was at 10,100% from 10,145%, while the 11-year R157 bond was bid at 10,310% from its previous close of 10,360%.
The rand was quoted at 6,7201 to the US dollar from 6,7350 at Friday’s close and 6,9326 at Thursday’s close.
“The strength this morning is all related to winning the bid to host the World Cup. That has seen the rand strengthen. I think guys will try and push the R153 below 10% so as to prompt short-covering,” the dealer said.
Foreigners were net sellers of R417,642-million of South African bonds on Friday after net sales of R143,136 million of local bonds on Thursday, Bond Exchange of South Africa statistics show.
Nominal cumulative volume was R16,567-billion on Friday from R16,901-billion on Thursday. – I-Net Bridge