India Rupee At Over 3-Week Low As China Seeks More Trade Talks

India Rupee At Over 3-Week Low As China Seeks More Trade Talks

14 Oct 2019 05:28 PM

Financial Market Overview

Indian Rupee

  • The Indian rupee closed at over three-week low against the dollar, following a report that said China wanted further trade talks before signing a partial trade deal with the U.S.
  • The rupee settled at day’s low of 71.23 to a dollar, also its lowest since Sep. 19, against 71.02 at previous close.
  • The local unit opened at 70.88 and had climbed to a two-week high of 70.76 in early trade. Rupee came under pressure as inflows were less due to holiday in the U.S. and some dollar purchases by state-run banks. Today’s inflows may hit the market tomorrow. Amid recent turn of events on the trade front, traders now await the U.S. reaction to China’s comments.

Indian Equities

  • Indian shares ended higher on Monday, buoyed by auto and real estate stocks, as investors awaited headline inflation data due later in the evening.
  • The broader NSE index closed 0.32% higher at 11,341.15 and the benchmark BSE index ended up 0.23% at 38,214.47.Indian retail inflation probably reached a 12-month high in September, but still leaving room for further interest rate cuts because it's expected to remain below the Reserve Bank of India's target, Meanwhile, auto stocks led gains, with the index rising 1.67% at close. Tata Motors closed up 5.03%.

Global Markets

  • European markets are lower today with shares in France off the most. The CAC 40 is down 0.79% while Germany's DAX is off 0.63% and London's FTSE 100 is lower by 0.48%.
  • U.S. stocks ended more than 1% higher on Friday though well off the day's highs after the announcement of a partial trade deal between the United States and China. Indexes cut their gains late in the session as the deal was announced amid worries over the possibility of further flare-ups before the agreement is finalized. The Dow Jones Industrial Average rose 319.92 points, or 1.21%, to 26,816.59, the S&P 500 gained 32.14 points, or 1.09%, to 2,970.27 and the Nasdaq Composite added 106.27 points, or 1.34%, to 8,057.04.
  • Euro zone industrial production rose in August by more than expected, official estimates showed on Monday, as factories invested more on machinery in a positive sign for the bloc's economic outlook amid a largely gloomy outlook. The European Union statistics agency Eurostat said industrial output in the 19-country bloc grew in August by 0.4% on the month, above the market consensus of a 0.3% rise. The increase, only the third monthly increase in 2019, fully offset the 0.4% drop recorded in July.
  • The German economy is unlikely to slide into a prolonged recession even as it languishes in a weak growth cycle. The German economy is expected to contract slightly in the third quarter as it did in the April-June period as exports weaken on uncertainties linked to Britain's planned departure from the European Union as well as trade conflicts. The technical recession expected in the third quarter will come after nine successive years of growth, fueled by an export boom mainly to China and more recently a consumption-driven cycle supported by low interest rates in the euro zone.