Financial Market Overview
11th January, 2019
MARKETS AT OPEN:-
- The Indian rupee opened little changed against the dollar mirroring the quiet performance of its regional peers after Federal Reserve Chairman Jerome Powell once again said muted inflation allows the U.S. central bank to be patient on interest rates.
- The rupee opened at 70.42 versus its previous close of 70.42. As to where the current indecision the pair is going to resolve will be a function of how much the dollar suffers on account of the recent consistent Fed rhetoric and where oil prices head from here.
- Except for the yuan, Asian currencies were trading mostly flat against the dollar on Friday after Powell said that tepid inflation allowed the Fed flexibility on interest rates.
- We expect USD/INR to trade in a range between 70.20- 70.70 today.
- Equity benchmarks have witnessed a positive start with the Sensex rising over 66.66 points, while the Nifty is also in positive mood in its opening trade and trading above 10,800.00 level.
- The Sensex trading up by 66.66 points and 0.18% at 36173.16 while the Nifty trading up by 0.09% at 10831.30 or 9.70 point up.
- Asian markets are higher today as Japanese and Hong Kong shares show gains. The Nikkei 225 is up 0.71% while the Hang Seng is up 0.17%. The Shanghai Composite is trading little positive by 0.11%. Where Australian ASX 200 is down by -9 points negative and -016%.
- European markets finished mixed as of the most recent closing prices. The FTSE 100 gained 0.52% and the DAX rose 0.26%. The CAC 40 lost 0.16%.
- Wall Street extended its rally into a fifth straight session on Thursday with whipsaw trading as investors responded to mixed comments by U.S. Federal Reserve Chairman Jerome Powell, while a warning from Macy’s pummeled retail stocks. The Dow Jones Industrial Average rose 119.27 points, or 0.5 percent, to 23,998.39, the S&P 500 gained 11.5 points, or 0.44 percent, to 2,596.46 and the Nasdaq Composite added 28.99 points, or 0.42 percent, to 6,986.07.
- The number of Americans filing applications for jobless benefits fell more than expected last week, pointing to sustained labor market strength that could further assuage concerns about the economy’s health. The report from the Labor Department on Thursday followed data last week showing employers hired the most workers in 10 months in December and increased wages.
- Powell’s message confirmed the Fed’s recent dovish turn. Fed officials, including Powell, in recent days have indicated that turbulence financial market and uncertainty over the global growth outlook will make them move slower on further interest rates increases. The Fed’s December meeting minutes, released earlier this week, signaled the same. Meanwhile, investor focus will be on the U.S. inflation data, more so considering that the Fed’s softening stance is premised on inflation remaining under control. Economists polled by Reuters expect consumer prices to have risen by 1.9% in December, slower than the 2.2% in the prior month.
- Dollar index 0.1% lower at 95.43, after rising by 0.3% in previous session. Brent crude oil contract 0.6% lower at $61.29 per barrel, after closing at one-month high yesterday.