Dec 17 2018

Rupee At 1-Week High As Trade Gap Narrows

Financial Market Overview

17th December, 2018

Evening Coffee                                                                        

Indian Rupee:-

  • The Indian rupee rose to a one-week high against the dollar, supported by narrowing local trade deficit amid lower crude oil prices, even while investors cautiously await the Federal Reserve’s monetary policy decision this week.
  • The rupee settled at 71.55 to a dollar, its highest since Dec. 10, and against 71.90 at previous close. It opened higher at 71.79 and fell to an intraday low of 71.86, before rebounding to 71.65. Most Asian currencies ended mixed against the greenback.
  • The next important event that markets will be focusing on this week’s Fed meet, where the authority is expected to raise interest rates. However, the major focus will be on the guidance for 2019. Any indication of three rate hikes or hawkish comments on back of upbeat U.S. economic data may lift the dollar and weaken the local unit.

 Indian Equities:-

  • Benchmark indices ended on strong note with Sensex closed up 300 points, while Nifty ended just below 10,900.
  • At the close, the Sensex was up 307.14 points at 36,270.07, while Nifty was up 82.90 points at 10,888.40. About 1400 shares have advanced, 1192 shares declined, and 150 shares are unchanged.
  • Power Grid Corp, Tata Motors, HDFC, Coal India and Vedanta are the top gainers on the Sensex, while Kotak Mahindra Bank, Infosys, Bharti Airtel, Hero Motocorp and L&T are among major losers.

 Global Markets:-

  • European markets are lower today with shares in France off the most. The CAC 40 is down 0.37% while London’s FTSE 100 is off 0.13% and Germany’s DAX is lower by 0.05%.
  • Wall Street’s three major indexes slumped on Friday as weak data from China and Europe stoked fears of a global economic slowdown, while Johnson & Johnson was a major drag on the S&P 500 and Dow after Reuters reported the company had known knew for decades that asbestos lurked in its Baby Powder.
  • The Dow Jones Industrial Average fell 496.87 points, or 2.02 percent, to 24,100.51, the S&P 500 lost 50.59 points, or 1.91 percent, to 2,599.95 and the Nasdaq Composite dropped 159.67 points, or 2.26 percent, to 6,910.67.
  • Euro zone consumer price inflation for November was unexpectedly revised lower on Monday, adding to skepticism that the European Central Bank will be able to move ahead with an interest rate hike in 2019. The bloc’s statistics agency Eurostat said that CPI rose 1.9% in November from the same month a year earlier.
  • Consensus had expected no change from the initial estimate of 2.0%. Core inflation, which excludes energy, food, alcohol and tobacco prices, rose by an annual rate of 1.0%, unchanged from the preliminary estimate and in line with forecasts.
  • British consumer spending fell by the most since July last month, payments company Visa said on Tuesday, adding to signs of slowing economic growth toward the end of the year. Consumer spending dropped 0.7 percent year-on-year in November, a sharper decline than October’s 0.2 percent drop, Visa said, based on inflation-adjusted usage data from its debit, credit and prepaid cards.