South Korean government bond futures rose in night trading on August 6, driven by downward stabilization in international oil prices amid expectations of Strait of Hormuz reopening. The 3-year bond futures closed at 103.58, up 5 ticks from the previous day's regular trading session, while 10-year bond futures climbed 35 ticks to 107.22. Foreign investors net purchased 7 contracts of 3-year futures and 60 contracts of 10-year futures, reflecting continued demand in the bond market as geopolitical oil supply concerns eased.
3-Year and 10-Year Bond Futures Post Night Trading Gains
According to the Seoul bond market on August 6, 3-year government bond futures closed at 103.58 in night trading, up 5 ticks from the previous day's regular trading close. Foreign investors net purchased 7 contracts while individual investors net sold 7 contracts.
10-year government bond futures finished trading at 107.22, up 35 ticks. Foreign investors net purchased 60 contracts, while financial investment firms and individual investors net sold 15 contracts and 44 contracts respectively.
Trading Volumes Decline Across Bond Futures Contracts
Trading volume for 3-year bond futures decreased from 58 contracts in the previous trading day to 13 contracts. Trading volume for 10-year bond futures fell from 104 contracts to 92 contracts.
![10-year government bond futures night trading trend]()
10-year government bond futures night trading trend. Source: Yonhap Infomax.
US Treasury Yields Show Mixed Movement
US Treasury yields displayed mixed movements during the same period. The 10-year US Treasury yield rose 0.40 basis points compared to the previous trading day's New York market close, while the 30-year yield fell 0.40 basis points. The 2-year yield declined 0.60 basis points.
International oil prices continued to stabilize downward on expectations of Strait of Hormuz reopening, providing ongoing bullish support for bond markets. An unexpected signal emerged suggesting potential future reductions in coupon bond auctions. Signs of intensifying price pressures in US services temporarily applied bearish pressure across the yield curve during trading.
ISM Services PMI Reveals Employment Contraction and Price Pressures
According to the Institute for Supply Management (ISM), the services Purchasing Managers' Index (PMI) for July reached 54.1, up 0.1 points from the previous month. The figure fell short of market expectations of 54.5.
Among sub-indices, the employment index stood at 47.4, down 3.8 points from the previous month. The index returned to contraction territory after one month.
The price index rose from 67.7 in the previous month to 70.3. The price index has exceeded 70 four times in the past five months.
FAQ
What caused South Korean bond futures to rise in night trading on August 6?
South Korean government bond futures rose in night trading on August 6 due to downward stabilization in international oil prices amid expectations of Strait of Hormuz reopening. The 3-year bond futures gained 5 ticks to 103.58 while 10-year futures climbed 35 ticks to 107.22, with foreign investors net purchasing both contracts.
How did trading volumes change for Korean bond futures on August 6?
Trading volumes for Korean bond futures declined significantly on August 6. The 3-year bond futures volume dropped from 58 contracts in the previous trading day to 13 contracts, while 10-year bond futures volume fell from 104 contracts to 92 contracts, indicating considerably subdued trading activity compared to usual levels.
What did the July ISM services PMI data reveal about the US economy?
The July ISM services PMI reached 54.1, up 0.1 points from the previous month but below market expectations of 54.5. The employment index fell 3.8 points to 47.4, returning to contraction territory, while the price index rose from 67.7 to 70.3, marking the fourth time in five months it exceeded 70.
