Feb 04 2019

Rupee At 7-Wk Low As Robust Data Lifts U.S. Yields

Financial Market Overview

04th February, 2019

Evening Coffee

MARKETS AT CLOSE:-                                    

Indian Rupee:-

  • The Indian rupee fell for a second consecutive session today to a seven-week low against the dollar, as robust U.S. jobs and manufacturing data lifted U.S. yields and lifted greenback demand.
  • The rupee ended at 71.80 to a dollar, lowest since Dec. 14, against 71.24 at previous close. The currency opened at 71.60, extending losses to 71.82. The unit fell 0.8% today, its largest decline since Jan. 2. Most Asian currencies ended lower against the greenback.
  • Rupee came under pressure due to both global and domestic factors. Higher oil prices and upbeat U.S. jobs data print that lifted dollar, added to the rupee’s fall which was already pressured by the populist domestic budget.

Indian Equities:-

  • A good fight put up by the bulls in the last hour ensured that the market had a good start to the week. The Sensex closed with gains of over 100 points, while the Nifty ended above 10,900-mark.
  • At the close of market hours, the Sensex was up 113.31 points or 0.31% at 36582.74, and the Nifty was up 18.60 points or 0.17% at 10912.30. The market breadth was negative as 813 shares advanced, against a decline of 1,754 shares, while 161 shares were unchanged.

 Global Markets:-

  • European markets are mixed. The FTSE 100 is higher by 0.26%, while the CAC 40 is leading the DAX lower. They are down 0.43% and 0.19% respectively.
  • Wall Street indexes were mixed on Friday, as optimism from a surge in January U.S. job growth was offset by a weaker-than-expected outlook from Amazon.com Inc that battered retail stocks. The Dow Jones Industrial Average rose 64.22 points, or 0.26 percent, to 25,063.89, the S&P 500 gained 2.43 points, or 0.09 percent, to 2,706.53 and the Nasdaq Composite dropped 17.87 points, or 0.25 percent, to 7,263.87.
  • Euro zone producer prices fell more than expected month-on-month in December, pulled down by cheaper energy, data from the European Union’s statistics office Eurostat showed on Monday. Eurostat said prices at factory gates in 19 countries sharing the euro fell 0.8 percent in December against November and were 3.0 percent higher than in December 2017.
  • Activity in the U.K. construction sector slowed to a 10-month low in January, as uncertainty over the U.K.’s pending departure from the European Union made builders cautious over new projects.
  • The report follows a similar one for the manufacturing sector on Friday that also fell short of expectations, and noted that companies were stockpiling at the fastest rate in years to ensure they can keep producing if the U.K. leaves the EU on March 29.
  • Oil prices rose to their highest so far this year on Monday as OPEC-led supply cuts and U.S. sanctions against Venezuela’s petroleum industry tightened markets. International Brent crude oil futures climbed to a 2019 high of $63.37 per barrel after already rising by 3 percent the previous session. U.S. West Texas Intermediate futures hit a 2019 high of $55.68 per barrel around the same after already gaining 2.73 percent in the last session.
  • India’s Hindu nationalist-led government poured extra money into support for farmers and a rural jobs program, delivering on Friday its last budget before a general election due by May with the clear aim of winning over votes. Prime Minister Narendra Modi’s ruling alliance is facing discontent over depressed farm incomes and doubts over whether his policies are creating enough jobs.