May 23 2018

Rupee drops ahead of Fed minutes and renewed concerns over US-China trade negotiations

Financial Market Overview

23rd May, 2018

Morning Coffee:-                                                                                  

MARKETS AT OPEN:-

Rupee:-

  • Indian rupee opened lower against the dollar at 68.15, in-line with weakness in most regional currencies, ahead of the Federal Reserve’s May meeting minutes release. Renewed concerns over U.S. and China trade matters also weighed on demand for regional assets. Pair USDINR now at 68.23 against 68.04 previous close.
  • Pair to tip in range between 68.10-68.35.

Indian Equities:-

  • Benchmark indices started off trade on a flat note on Wednesday despite weakness in Asian peers.
  • The 30-share BSE Sensex declined 24.59 points to 34,626.65 and the 50-share NSE Nifty slipped 15.70 points to 10,521.

Global Markets:-

  • Asian markets are lower today. The Hong Kong’s Hang Seng lost 0.98% , the Australian ASX200 is trading down by 0.83% and the Shanghai Composite is fell by 0.12%.
  • European markets finished higher today with shares in Germany leading the region. The DAX is up 0.71% while London’s FTSE 100 is up 0.23% and France’s CAC 40 is up 0.05%.
  • US. stocks ended lower on Tuesday as uncertainty lingered over trade talks between the United States and China and as energy and industrial shares fell. The Dow Jones Industrial Average fell 178.88 points, or 0.72 percent, to 24,834.41, the S&P 500 lost 8.57 points, or 0.31 percent, to 2,724.44 and the Nasdaq Composite dropped 15.58 points, or 0.21 percent, to 7,378.46.
  • Minutes of the Fed’s May meeting, due later today, will be closely scrutinized to assess how many more times the U.S. central bank will raise interest rates in 2018. While a rate hike next month, the second this year, is more or less a certainty, the minutes could offer hints whether there will be one or two rate increases thereafter in the remainder of the year. The main attention will be on the inflation after the Fed at the May meeting said the 2% inflation target was “symmetric.”
  • President Donald Trump tempered enthusiasm over progress made by the U.S. and China on trade talks. Trump on Tuesday signaled dissatisfaction with the China negotiations, saying he was not pleased with the recent trade talks between the two nations. Over the weekend, U.S. Treasury Secretary had said that trade war with China was on hold, providing hopes of an early resolution to the conflict.