| "Today was a dull day, the high opening was a reaction to fall in US yields. But we are back at yesterday's (Tuesday) levels as local factors took over," said Vikram Kadam, head of asset liability management at BNP Paribas Bank. |
| Traders are likely to shy away from carrying positions until Friday, when the central bank is expected to announce auction under the Market Stabilisation Scheme. |
| "Fears of RBI doing something are there, so no one wants to hold or add any new large positions," said a dealer at a state-owned bank. |
| The most traded 10-year, 7.49 per cent, 2017 paper had surged almost 40 paise to Rs 97.40 (7.8740 per cent), but ended at Rs 97.06 (7.9255 per cent) compared with Rs 97.02 (7.9315 per cent) on Tuesday. |
| Intraday, market did not react to the sharply lower cutoff yields awarded by RBI at the Rs 35 billion auction of 91- and 182-day Treasury bills as it was already factored in, dealers said. |
| The central bank set cutoff yield of 5.11 per cent on 91-day T-bill compared with 6.19 per cent previously. It set cutoff yield of 6.05 per cent on 182-day T-bill versus 7.66 per cent previously. |
| Market also ignored comments by a finance ministry aide that there was no immediate need to hike the cap on investments by foreign institutional investors in the bond market. |
| Dealers said the government had been considering the hike for a long time but market needed something concrete to react. |
| On Thursday, gilts are likely to open flat as banks and primary dealers avoid taking new positions on continuing ambiguity over any moves from RBI. |
| "Just waiting for the very crucial Friday, nothing else," said a dealer at another state-owned bank. Intraday, bouts of profit booking are likely to cap every rise. |
| Local market will also take cues from today's movement in the US Treasury yields and global crude oil prices. |
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