Financial Market Overview
25th January, 2019
- The Indian rupee was little changed this week against the dollar as lower crude oil prices offset the impact of foreign fund outflows from local bonds, while the country’s fiscal position stayed in focus ahead of the federal budget. The rupee, settled lower at 71.18 to a dollar, against 71.07 previous close. The currency opened higher at 71.00 and briefly rose to the day’s high of 70.95 before falling to 71.24.
- Foreign investors were net sellers of $227.48 million of local debt this week until yesterday, data from National Securities Depository Ltd. showed. These investors sold net local shares worth $27.31 million yesterday but were net buyers of $4.71 million worth of local shares until yesterday this week.
- Indian indices erased all its morning gains and ended lower on Friday with Nifty finished below 10,800 level.
- At the close, the Sensex was down 169.56 points at 36,025.54, while Nifty was down 69.30 points at 10, 780.50. About 692 shares have advanced, 1829 shares declined, and 150 shares are unchanged.
- European markets are broadly higher today with shares in Germany leading the region. The DAX is up 1.34% while France’s CAC 40 is up 0.89% and London’s FTSE 100 is up 0.35%.
- The number of Americans filing applications for unemployment benefits fell to more than a 49-year low last week, but the drop likely overstates the health of the labor market as claims for several states including California were estimated.
- Brent crude oil contract was trading 0.5% lower at $60.83 per barrel amid concerns over global growth and unexpected increase in U.S. inventories. The contract slipped 0.6% yesterday after falling 2% on Jan. 22. The economy is facing several headwinds, including a bitter U.S. trade dispute with China and a month-long partial shutdown of the federal government, which are hurting consumer and business confidence. Higher interest rates, fading fiscal stimulus and cooling global economies are also seen crimping domestic growth.
- Tokyo’s core consumer price inflation picked up slightly more than expected in January due to higher energy prices, but Japan’s central bank still has a long way to achieve its elusive 2 percent inflation target. The Bank of Japan on Wednesday cut its consumer inflation forecasts and maintained its massive stimulus program, with Governor Haruhiko Kuroda warning of growing risks to the economy from protectionism and faltering demand. Core consumer prices in Tokyo, a leading indicator of nationwide price trends, rose 1.1 percent in January from a year earlier.
- Brent crude oil contract was headed for its first weekly fall in four, as concerns over global economic growth stoked fears over future demand. The contract was down 2.8% for the week and last trading 0.3% lower at $60.93/b.