Africa-Press – Tanzania. Dar es Salaam Stock Exchange’s (DSE) activities of the bond secondary market have been vibrant with trades increasing week by week and are tipped to continue toward Christmas.
The fixed income activities have gone up by 25 per cent for seven days thanks to awareness surging that pushed up investors’ appetite.
Zan Securities said in its weekly market wrap-ups that that the secondary market activities have been vibrant with trades increasing week by week.
“The fixed income market trades continue to be high and we expect it to continue that way as we approach the end of the year,” Zan said in the report on Monday.
However, the brokerage firm said that the high prices of long dated papers may make investors to look for junior Treasury bonds especially 15 and 10 years instruments.
“High prices of long dated papers will make investors migrate to the next attractive coupon such as the 15 year and the 10 year Treasury bond,” Zan said.
For instance, last week, the Bank of Tanzania (BoT), through its weekly debt securities auction, sought to raise a total of 114bn/- from the public through a 2-year Treasury paper.
Orbit Securities said in its weekly market synopsis that given the investors’ appetite on the securities is at an all-time high, the public tendered 217.07bn/- an oversubscription of over 90 per cent.
“The investor’s pricing of the bond has improved, as the highest price moved to 102/- from 101/59 of previous auction,” Orbit said om Monday adding: “The BoT cut-off price has also improved on this auction to 99/15 from 98/79 of previous similar auction”.
Despite great response from Investors, the BoT only took 164bn/-, discarding over 53bn/- tendered by the public.
The weighted average yield to maturity for the security stands at 7.65per cent.
Vertex International Securities said in its weekly review that yields continue to decrease in this week’s 2–year Treasury bond as BoT continued to reopen previous bonds.
“We expect 364 Days bill to outperform [this] week,” Vertex said. In the secondary market, the value of bonds traded increased by 28.6per cent in November to 202bn/- from 157bn/-recorded in October.
The 15 year bond representing 106bn/- or 53 per cent of the total value traded in November.
Also, in the corporate segment bonds of 8.0m/- were traded from 2 deals.
“We expect more downward pressure on the yield curve as investors migrate from expensive long dated papers in the secondary bond market to 15 year and 10 year bonds,” Zan Securities said.
For More News And Analysis About Tanzania Follow Africa-Press
