India Rupee At 4-Week Low Tracking Decline In Offshore Yuan

India Rupee At 4-Week Low Tracking Decline In Offshore Yuan

15 Oct 2019 05:32 PM

Financial Market Overview

Indian Rupee

  • The Indian rupee hit a four-week low against the U.S. currency, tracking a decline in the Chinese yuan as optimism about the likelihood of a U.S.-China trade deal weakened.
  • The rupee settled at 71.54 to a dollar, its lowest since Sep. 17, against 71.23 at previous close. It opened little changed at 71.24 and fell to 71.57 in late trade. The positive momentum on which the local unit was riding high has faded and the possibility of depreciation has become stronger due to fears of a global slowdown. “If rupee trades above 71.40 mark in tomorrow’s trade as well, the outlook on the unit will get more bearish in coming days.

Indian Equities

  • Indian shares ended higher on Tuesday, led by auto sectors, as investors hoped for further rate cuts from the country's central bank amid a rise in retail inflation during the last month.
  • India's retail inflation rose close to the Reserve bank of India's medium-term target of 4% in September for the first time in 14 months, but analysts still predict a sharp economic slowdown will prompt a sixth consecutive interest rate cut in December.
  • The broader NSE index ended 0.77% higher at 11,428.30, while the benchmark BSE index closed up 0.76% at 38506.09. The Nifty Auto index ended 2.23% higher as Eicher Motors closed up 4.69%, while Hero Motocorp Maruti Suzuki and Mahindra and Mahindra ended firmer between 2.4% and 2.6%.

Global Markets

  • European markets are mixed today. The CAC 40 is up 0.49% while the DAX gains 0.35%. The FTSE 100 is off 0.41%.
  • Wall Street edged lower on Monday as uncertainties following recent U.S.-China trade negotiations clouded sentiment and investors turned their focus on the third-quarter earnings season, which begins in earnest on Tuesday. All three major U.S. stock averages closed in the red, snapping a three-day winning streak during which the benchmark S&P 500 gained 2.7%. The Dow Jones Industrial Average fell 29.23 points, or 0.11%, to 26,787.36, the S&P 500 lost 4.09 points, or 0.14%, to 2,966.18 and the Nasdaq Composite dropped 8.39 points, or 0.1%, to 8,048.65.
  • The mood among German investors worsened less in October than analysts had expected, a survey showed on Tuesday, amid concern that Europe's biggest economy might be headed for a recession. Economic sentiment among investors fell to -22.8 points in October from -22.5 points in the previous month. A second index, measuring investors' assessment of the economy's current shape, fell to -25.3 from -19.9 points.
  • China’s credit growth continued to accelerate in September, with an expected seasonal increase boosted by faster bond issuance in a month when the central bank acted again to guide borrowing costs lower. Aggregate financing was 2.27 trillion yuan ($321 billion) last month, compared to about 1.98 trillion yuan in August, the People’s Bank of China said Friday. The median estimate by economists was 1.9 trillion yuan.
  • The British pound took center stage again on Tuesday, rising sharply against the dollar and euro on renewed speculation of a deal to allow the U.K. to leave the EU smoothly at the end of the month. GBP/USD was at $1.2667, up 0.5%, while EUR/GBP was at 0.8715, down 0.3%.

Source : Myforexeye Research

Date : Oct-2019

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