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Daily Updates
Thu,17 Aug 2017

  • Indian equity market closed in the green amid firm global signals on receding tensions between the U.S. and North Korea. Also, positive signals from European markets before the release of U.S. Federal Reserve meeting minutes and British unemployment data helped improve market sentiment. However, hopes of further rate cut by the Reserve Bank of India dampened after India’s Consumer Price Index data for Jul 2017 came in more than expected. 

  • Key benchmark indices S&P BSE Sensex as well as Nifty 50 grew 1.02% and 1.05% to close at 31,770.89 and 9,897.30, respectively. S&P BSE Small-Cap and S&P BSE Mid-Cap went up 1.31% and 1.26%, respectively.

  • On the BSE sectoral front, indices closed on a positive note. Among the gainers were S&P BSE FMCG (2.49%), S&P BSE Metal (1.72%), S&P BSE Auto (1.62%), S&P BSE Finance (1.42%), S&P BSE Basic Materials (1.30%), S&P BSE Bankex (1.26%), and S&P BSE Consumer Discretionary Goods & Services, and S&P BSE Healthcare both (0.95%). The losers comprised S&P BSE Capital Goods, down 0.13%, trailed by S&P BSE Utilities (-0.05%).
Domestic Indices Performance   
  16-Aug-17 1D % Chg 1M % Chg 1Yr % Chg
Nifty 50 9,897 1.05 0.11 14.52
S&P BSE Sensex 31,771 1.02 -0.78 13.21
S&P BSE Midcap 15,282 1.26 0.63 19.17
S&P BSE Smallcap 15,612 1.31 -1.86 27.83
S&P BSE Auto 23,987 1.62 -0.94 12.75
S&P BSE Bankex 27,573 1.26 1.65 26.39
S&P BSE CD 17,623 0.31 10.35 45.16
S&P BSE CG 17,255 -0.13 -2.18 14.11
S&P BSE FMCG 10,030 2.49 -7.24 14.80
S&P BSE HC 13,215 0.95 -10.12 -17.43
S&P BSE IT 10,262 0.50 2.10 -4.99
S&P BSE Metal 12,932 1.72 8.10 30.70
S&P BSE Oil 14,615 0.35 5.09 36.28
S&P BSE Power 2,275 0.40 -0.51 9.57
S&P BSE PSU 8,490 0.63 -0.22 15.88
S&P BSE Realty 2,095 0.83 -2.04 32.90
S&P BSE Teck 5,773 0.40 1.44 -2.11
VIX Index 14 -1.01 27.43 0.39
  • Bond yields rose after retail inflation grew higher than expected in Jul 2017 lowering hopes of any further easing by the Monetary Policy Committee in the near term.

  • Yield on the 10-year benchmark paper (6.79% GS 2027) rose 1 bps to 6.53% from 6.52% in the previous trading session. During the session, bond yields traded in the range of 6.52% and 6.55%.

  • Banks’ borrowings under the repo window of the Liquidity Adjustment Facility (LAF) stood at Rs. 2,180 crore (gross) on Aug 16, lower than Rs. 2,620 crore (gross) borrowing on Aug 14. Sale of securities under Reserve Bank of India’s (RBI) reverse repo window stood at Rs. 5,033 crore on Aug 14.

  • Banks borrowed Rs. 950 crore under the central bank’s Marginal Standing Facility on Aug 14 as against borrowing of Rs. 1,030 crore on Aug 11.
Daily Rates    
Key Rates (%) 16-Aug-17 Previous Close Year Ago
10 Yr Gsec 6.53 6.52 7.11
5 Yr AAA Corp Bond 7.14 7.10 7.54
3 Yr AAA Corp Bond 7.00 6.99 7.45
1 Yr AAA Corp Bond 6.74 6.73 7.31
3 Yr AA Corp Bond 7.45 7.39 7.93
1 Yr AA Corp Bond 7.10 7.09 7.81
12 Month CD 6.48 6.47 7.23
3 Month CD 6.19 6.19 6.64
CALL 5.84 5.86 6.42
CBLO 5.84 5.93 6.46

 

Institutional Flows     
(INR Cr) FII Flows MF Flows1
As on August 16,2017 Debt Equity Debt Equity
Purchases 292 3,289 1,627 944
Sales 490 4,813 2,921 983
Net -197 -1,524 -1,294 -38
MTD Net 9533 -5417 5000 4434

1 As on August 10, 2017

  • Straits Times - The index slipped 0.48% amid growing speculation over probable rate hike by the U.S. Federal Reserve in Dec 2017.
  • Nikkei – The index slipped 0.12%, dragged by stocks of automakers. The auto sector remained concerned over the industry outlook amid uncertainty of the fate of Mexico ahead of the first round of North American Free Trade Agreement (NAFTA) negotiations. The automotive sector is one of Mexico’s most important industries in terms of foreign direct investment, export volume, and employment.
  • Hang Seng – The index went up 0.86% after the International Monetary Fund revised upward its growth forecast for China.
  • FTSE – The index grew 0.67% amid easing geopolitical tensions in the Korean peninsula and slightly better than expected gross domestic product data of Eurozone for the second quarter. However, investors were cautious ahead of U.S. Federal Reserve minutes.
  • Dow Jones – The index rose 0.12% as U.S. Federal Reserve minutes showed that the central bank is on track to unwind its $4.5 trillion balance sheet at an upcoming meeting. Expectations of one more rate hike this year also supported the indices. However, political turbulence in U.S. and weak housing data in Jul 2017 capped most of the gains.
Global Indices Performance   
Global Indices 16-Aug-17 1D % Chg 1M % Chg 1Yr % Chg
Dow Jones 22,025 0.12 1.79 18.72
Nasdaq 100 5,917 0.16 1.36 23.35
FTSE  7,433 0.67 0.74 7.82
Straits Times 3,279 -0.48 -0.26 14.70
Nikkei 19,729 -0.12 -1.94 18.88
Hang Seng 27,409 0.86 3.86 19.63
Shanghai Composite 3,246 -0.15 0.75 4.39
  • Gold prices gained ahead of the release of U.S. Federal Reserve’s Jul 2017 policy meeting minutes. Gold prices were last seen trading at $1,272.20 per ounce, compared with the previous close of $1,271.38 per ounce.

  • Brent crude prices inched up after data from the American Petroleum Institute (API) indicated that U.S. oil inventories fell by 9.16 million barrels in the week ended Aug 11. Oil prices were last seen trading at $50.2 per barrel, compared with the previous close of $49.79 per barrel.
Commodity Market    
Commodity (INR) 16-Aug-17 1D % Chg 1M % Chg 1Yr % Chg
Brent (1 barrel) (in $) 50.28 -1.76 4.79 4.40
Gold (10 gm) 28,726 -0.61 3.15 -8.21
Silver (1 kg) 38,144 -1.60 4.62 -18.00
Aluminium (1 kg) 133.30 2.58 8.68 18.91
Copper (1 kg) 410.00 -0.47 8.72 30.06
  • The Indian rupee inched down against the greenback as market participants remained on the sidelines ahead of the release of U.S. Federal Open Market Committee’s Jul meeting minutes, due later in the day.

  • The euro weakened against the U.S. dollar after U.S. retail sales witnessed their biggest increase in seven months in Jul 2017, which renewed concerns of another rate hike by the U.S. Fed.
Currency Market    
Currency 16-Aug-17 1D % Chg 1M % Chg 1Yr % Chg
USD/INR 64.24 0.34 -0.33 -3.97
EURO/INR 75.38 -0.43 2.46 0.47
GBP/INR 82.62 -0.79 -1.11 -4.31
100 JPY/INR 58.01 -0.72 1.95 -13.00
  • The Securities and Exchange Board of India (SEBI) announced that it has increased focused inspection of suspected brokers and other entities, thereby leading to action against hundreds of them. This comes in the wake of crack down on the misuse of the stock market for money laundering.

  • Government has allowed export of gold jewellery (plain or studded) and other articles having 8 carat and above up to maximum limit of 22 carat purity. However, above 22 carat export has been banned with an aim to check round tripping of the precious metal. The limit is applicable for domestic tariff area and export-oriented units, electronics hardware technology parks, software technology parks, and bio technology parks.

  • According to the government’s fourth advance estimates of production of major crops, total foodgrains output during FY17 is projected to be record 275.68 million tonne (mt), higher than the target of 270.10 mt in the third estimates. Rice at 110 mt and wheat production at 98.38 mt are expected to surpass the earlier estimate.
Key Economic Indicators   
Indicators Current Previous
GDP 6.10% (Q4 FY'17) 7.00% (Q3 FY'17)
IIP -0.10% (Jun'17) 1.70% (May'17)
WPI 1.88% (Jul'17) 0.90% (Jun'17)
CPI 2.36% (Jul'17) 1.46% (Jun'17)

Since May-17, MOSPI has revised base year of IIP & WPI from 2004-05 to
2011-12, and for CPI from 2010 to 2012

Policy Rates    
Key Rates (%) Current Previous
Reverse Repo 5.75 5.75
Repo 6.00 6.00
CRR 4.00 4.00
SLR 20.00 20.00
Bank Rate 6.25 6.25
  • Cadila Healthcare announced that U.S. Food and Drug Administration has given final approval to market its group firm Zydus Cadila drug diltiazem hydrochloride. Besides blood pressure, diltiazem hydrochloride is also prescribed for angina and certain heart rhythm disorders.

  • Coal India has posted 23% decline in its consolidated profit to Rs. 2,351 crore for the quarter ended Jun 30 as against Rs. 3,065.2 crore in the year-ago period. The decline in profit was due to higher expenses. The company has also planned capital expenditure investment of Rs. 8,500 crore in 2017-18.

  • Biocon Ltd. has withdrawn its application seeking European Union (EU) approval for two drugs Trastuzumab and Pegfilgrastim after the EU drugs regulator asked for re-inspection of their production facility. The company will re-submit the application form after the completion of inspection.
Upcoming Events  
Event Date
Forex Reserves 21-Aug-17
GDP Estimate (Q1 of FY18) 31-Aug-17

Source :ICRON Research

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