Date:- 05th January 2019
Markets from 31st December 2018 to 04th January 2019:-
Indian rupee rose for a third straight week against the dollar, as weak U.S. manufacturing data added to global growth worries and reduced expectation of more interest rate hikes by the Federal Reserve. On a weekly basis, the currency gains 0.30%. The rupee closes on Friday at 69.72 against the previous weekly close of 69.94 on December 28th, 2018 to a greenback. It trades in a weekly range between 70.5250 to 69.43 against the US Dollar.
India’s foreign exchange reserves rose for second consecutive week to $393.40 billion as of the week ended Dec. 28, from $393.29 billion in the previous week, according to central bank data released yesterday. The increase was mainly due to a rise in foreign currency assets to $368.08 billion from $367.97 billion a week earlier, according to the data.
India’s infrastructure output grew at 3.5 percent in November from a year earlier, government data showed on Monday, its slowest pace in 16 months. During April-November, the output growth was 5.1 percent from the year-earlier period, according to the data.
The U.S. dollar retreated against the euro on Friday, giving up all the gains logged after a robust U.S. jobs report, following comments from Federal Reserve Chairman Jerome Powell that the U.S. central bank will be sensitive to the downside risks the market is pricing in. Powell said the Fed is not on a preset path of interest rate hikes and suggested that it could pause its policy tightening as it did in 2016.
The December employment report showed renewed strength in the U.S. labour market. The economy created 312,000 new jobs at the end of 2018, with the majority – 301,000 – occurring in the private sector. Unemployment rate increased to 3.9 percent from near a 49-year low of 3.7 percent in November as a strong labour market pulled some 419,00 jobless Americans from the sidelines.
Activity among euro zone businesses dipped to its weakest in just over four years in December. IHS Markit’s Euro Zone Composite Final Purchasing Managers’ Index (PMI), considered a good measure of overall economic health, held above the 50 mark that separates growth from contraction. But it fell to 51.1 from November’s 52.7, also below a flash reading of 51.3.
Euro zone consumer prices rose at a slower-than-expected pace in December, according to a flash estimate released on Friday. The bloc’s statistics agency Eurostat said its consumer price index rose 1.6% in December from the same month a year earlier. Economists had expected annual inflation to decrease by 1.8%.
Even though activity in the UK service sector accelerated last month, the sector is showing a loss of momentum amid escalating uncertainty over the UK’s departure from the European Union. Research firm IHS Markit said its services purchasing managers’ index rose to 51.2 in December, compared to forecasts for a reading of 50.7. That was higher than November’s reading of 50.4.
The rate of growth in the economy’s manufacturing sector slowed in December, according to a report released on Thursday. The Institute of Supply Management said its manufacturing purchasing managers’ index fell to 54.1 in December, from 59.3 the previous month. Economists had forecast a reading of 57.7.
The number of people who filed for unemployment assistance in the U.S. last week fell less than expected, according to official data released on Thursday. The number of individuals filing for initial jobless benefits in the week ended Dec. 1 fell by 4,000 to a seasonally adjusted 231,000 the Labour Department said.
Activity in the UK construction sector slowed last month as political uncertainty from Brexit weighed, according to a closely watched business survey released on Thursday. Research firm IHS Markit said its construction purchasing managers’ index fell to 52.8 in December, compared to forecasts for a reading of 52.9. The prior month’s reading was 53.4.
Activity in the UK manufacturing sector accelerated to a six-month high in December. Research firm IHS Markit said its manufacturing purchasing managers’ index rose to 54.2 in December, compared to forecasts for a reading of 52.6. The prior month’s reading was 53.6.
U.S. stocks were higher after the close on Friday, as gains in the Technology, Basic Materials and Industrials sectors led shares higher. At the close in NYSE, the Dow Jones Industrial Average rose 3.29%, while the S&P 500 index gained 3.43%, and the NASDAQ Composite index added 4.26%.
Oil rose nearly 2 percent on Friday after proposed trade talks between the United States and China eased some fears about a global economic slowdown, but gains were capped after the United States reported a sharp build in refined product inventories.
Brent crude futures rose $1.11, a 1.98 percent gain, to settle at $57.06 a barrel. U.S. West Texas Intermediate (WTI) crude futures increased 87 cents to settle at $47.96 a barrel, a 1.85 percent gain. After both benchmarks fell sharply last year, prices posted solid gains in the first week of 2019, despite recent data that added to concerns about a slowing global economy. Brent increased about 9.3 percent for the week, while WTI rose about 5.8 percent.
Indian shares rose 0.5 percent on Friday, tracking global markets which heaved a sigh of relief as China stepped up efforts to revive its economy by cutting banks’ reserve requirement ratios.
The benchmark BSE index closed the session 0.51 percent higher at 35,695.10, while the broader NSE index ended up 0.52 percent at 10,727.35. Both indexes snapped two straight sessions of falls. For the week, the BSE index fell 1.1 percent, while the NSE index declined 1.24 percent.