Sep 10 2018

Rupee closed at Record Low On positive U.S. Data, Trade War Fears

Financial Market Overview

10th September, 2018

MARKETS AT CLOSE:-

Rupee:-

  • The Indian rupee ended at a record closing-low against the dollar, its largest single-session fall in a month, on foreign banks’ greenback sales and a sell-off tracking upbeat U.S. jobs report and trade war fears.
  • The rupee ended at 72.45 to a dollar off 23 paise from an intraday low of 72.68 and 71.73 previous close. Persistent dollar sales by private and state-run banks at various levels, likely on behalf of the Reserve Bank of India, helped ease the pace of depreciation in the rupeeIndia had raised funds by incentivizing NRI deposits in 1998, 2000 and 2013. The nation’s forex reserves fell to $400.10 billion at end-August from record high of $426.08 billion in April.

Indian Equities:-

  • An evening walk down Dalal Street | Sensex, Nifty start week on a negative note amid weak rupee, global tensions
  • The day was largely dominated by the bears, with the benchmarks seeing selling right from the first minute. Along with it, rupee’s weakness ahead added to its woes. The Nifty gave up 11,450-mark. India’s BSE Sensex ended 1.2% lower, tracking most other Asian shares that were traded in the red.

Global Markets:-

  • Equities in Asia ended mixed as investors continued to keep a track of trade war fears continued to dominate the cues. Nikkei 225 and South Korea’s Kospi extended their earlier gains to close higher.
  • European markets are higher today with shares in France leading the region. The CAC 40 is up 0.67% while Germany’s DAX is up 0.61% and London’s FTSE 100 is up 0.35%.
  • The euro was a shade higher at $1.1645 while sterling idled at $1.2939 amid ongoing uncertainty over Brexit negotiations.
  • The dollar index had advanced 0.4% overnight after average U.S. earnings came in 2.9% higher on year, over the 2.7% expected. The world’s largest economy added 201,000 jobs last month, higher than the 191,000 jobs expected by economists polled by Reuters. The index was last trading little changed.The Fed has raised rates twice this year and expected to hike by 25 basis points for a third time when it meets on Sep. 25-26. Dallas Fed President Robert Kaplan said the authority should keep increasing rates following strong jobs report.
  • The Brent crude oil contract traded up 0.9% at $77.49 per barrel, also weighing on the rupee.