South African government bonds were stronger on Tuesday morning, tracking gains in the rand, which firmed along with other emerging-market currencies. Signs that a compromise would be reached between the US and China over trade issues had bolstered market sentiment, analysts said. The rand and bonds had, however, been under some pressure on Monday despite this. A stronger dollar and rising treasury yields have recently led to foreigners lightening their exposure to local bonds, although domestic holdings have increased. The price action suggested local buyers still had more ammunition, said Sasfin Securities bond analysts. After the local government bond auction was concluded on Tuesday, foreign developments were likely to hold sway. Earlier, the Reserve Bank’s leading indicator for March declined to 107.4 points from February’s 108.3. Among the negative factors weighing on the index were a decline in number of building plans approved, while the spread between local 10-year bonds an...
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