Sep 21 2018

Rupee falls reflecting Indian equities’ volatility

Financial Market Overview

21st September, 2018

Evening Coffee

Rupee:-

  • The Indian rupee posted a fourth straight weekly decline against the dollar while plunging to a record low earlier this week, as the government’s recent measures to arrest the currency’s slump failed to lift sentiment amid rising crude oil prices and weak local shares.
  • The rupee settled higher at 72.1950 to a dollar, against 72.37 at close on Sep. 19. It opened higher and rose to the day’s high of 71.86 before briefly giving up all gains and falling to the day’s low of 72.47, tracking volatility in local shares.

Indian Equities:-

  • A day which will go down in history as one of the most volatile days of 2018 saw Sensex recovering by more than 900 points, while Nifty50 managed to just about hold on to 11,000 levels.
  • The S&P BSE Sensex finally closed 279 points lower at Rs 36, 841 while the Nifty50 ended 91 points down at 11,143 on Friday. For the week, Sensex has lost 1,249 points, or 3.2 percent, while Nifty lost nearly 400 points, or 3.2 percent, for the week ended September

Global Markets:-

  • Most Asian shares rallied for a second day, tracking record gains in all the three major U.S. indexes and lifting the MSCI International Emerging Market Currency Index for the third day.
  • European markets are higher today with shares in London leading the region. The FTSE 100 is up 0.99% while France’s CAC 40 is up 0.52% and Germany’s DAX is up 0.42%.
  • The dollar index was last trading at 94.02, after an overnight fall of 0.7%, posting its biggest single-session drop in a month and falling to more-than-two-month low of 93.83.The one-year dollar-rupee forward premium was at 3.19 rupees, from its previous close of 3.20 rupees.
  • Euro zone private sector activity slowed in September, according to survey data released on Friday. The composite output index, which measures the combined output of both the manufacturing and service sectors fell to 54.2 from 54.5, against expectations for 54.4.A reading above 50.0 on the index indicates industry expansion, below indicates contraction
  • The manufacturing PMI fell to 53.3 compared to expectations for 54.4 and from 54.6 a month earlier. The preliminary reading of the IHS Markit services purchasing managers’ index came in at 54.7 this month from 54.4 in August.
  • Brent crude oil inched closer to $80-per-barrel mark earlier this week and was heading for its second weekly rise amid reports that Saudi Arabia was comfortable with oil prices above $80 per barrel.