The SPI roller coaster was out yesterday with the market looking in danger of capitulating through the 4580 area yesterday following the Dec expiry (passed without much fanfare).
Local debt markets were reasonably well bid soon after the open & appeared set for a positive session however the gremlins soon returned in the shape of the long end seller & whilst not aggressive we began to drift off, this despite treasuries trading higher in the Asian time zone.
Despite a good lead & a positive open the SPI failed to seriously test the 4630 region yesterday & sellers emerged to ensure the market remained confined to recent ranges with expiry trade also hindering any chance of a consolidated move.
Another tightly held session yesterday with the market again threatening to break through the low 60's in the long end however ultimately not having the momentum or interest in doing so, as a result the market managed to grind it's way higher over the course of the session before settling near Tuesday's closes.
The SPI consolidated near the 4600 area yesterday & at times looked set to punch through the 12/16 area & make a bee line for the 4630 area however it was not to be & profit taking emerged to see the market close near the 4600 area after all.
A much more subdued session yesterday however the long end seller was still able to exert an amount of influence over the market & we saw the curve head out towards the 60 area, an area not witnessed for an extended period.
A whippy close for the Dec contract yesterday which fed through to the March contract & we saw frantic thin trade at different stages as the market positioned itself for the close. We fell significantly lower in morning before a bounce of significant note was witnessed & buyers quickly took their cue to dominate as the afternoon began.
The SPI traded in a 20 tick range on Friday bound by the 4580 – 4600 areas & despite looking extremely well bid soon after the open & trading up to the 4600 area sellers quickly emerged to cap gains reasonably quickly as it became apparent the optimism witnessed over the course of the week would be placed on the backburner for the session.
A day of carnage for the local bond market on Friday with sellers gaining the upper hand from the outset & pounding the buyers as has been the case for the majority of the week.
The SPI was well contained yesterday as the recent strength was shelved – the market consolidating near 4600 managing to hold above the 4580 despite not seriously testing the area.