Financial Market Overview
10th January, 2019
MARKETS AT OPEN:-
- The Indian rupee opened flat against the U.S. currency after Brent crude oil reached its highest in almost a month, overshadowing a broad weakness in the dollar amid dovish Federal Reserve minutes. The rupee opened at 70.46 versus its previous close of 70.46. The rupee is a “complete play” on oil prices at present, more so on account of the recent rally from 74.50 to the current level. In light of the rupee’s rally since October beginning, traders will be “quite unforgiving” about negative news for the domestic currency.
- The Brent crude jumped 4.6% yesterday to clinch its eighth straight daily advance. The nearest month contract moved into a bull market on Wednesday — a 20% rise from recent lows — amid a rebound in global risk appetite. After falling to a multi-month low of around $50 a barrel just before Christmas, Brent crude is up by 22% as of yesterday’s close
- We expect USD/INR to trade in a range between 70.15- 70.65 today.
- Equity benchmarks have witnessed almost flat start with the Sensex rising over 18.45 points, while the Nifty little flat in its opening trade and trading above 10,800.00 level.
- The Sensex trading up by 18.45 points and 0.05% at 36231.36 while the Nifty opened flat and little down by 0.01% at 10854.15 or 1.05 point down.
- Asian markets are lower today as Japanese and Hong Kong shares fall. The Nikkei 225 is off 1.40% while the Hang Seng is down 0.02%. The Shanghai Composite is trading up by 0.23%.. Where Australian ASX 200 is down by -8 points negative and -016.%.
- European markets finished higher today with shares in France leading the region. The CAC 40 is up 0.84% while Germany’s DAX is up 0.83% and London’s FTSE 100 is up 0.66%.
- Wall Street rallied for a fourth session on Wednesday, propelled by Apple, chipmakers and other trade-sensitive stocks after signs of progress in trade talks between the United States and China. The Dow Jones Industrial Average rose 91.54 points, or 0.38 percent, to 23,878.99, the S&P 500 gained 10.55 points, or 0.41 percent, to 2,584.96 and the Nasdaq Composite added 60.08 points, or 0.87 percent, to 6,957.08.
- Meanwhile, most Asian currencies were trading higher today after the dollar index fell by the most in three weeks on Wednesday. The dollar came under pressure against its major counterparts yesterday after minutes of the December Fed meeting revealed willingness among policymakers to be more patient on additional interest rate increases. Many Fed officials were of the view that muted inflation pressures allowed the U.S. central bank to be patient on further monetary tightening, confirming last week’s message by Fed Chair Jerome Powell of flexibility in setting interest rates this year.
- Fed minutes of the December meeting showed more discussion and more support for caution in the meetings ahead – seemingly in keeping with the more dovish message Powell presented.
- China’s producer price index (PPI) in December rose 0.9 percent from a year earlier, marking the lowest rate since September 2016 and slowing sharply from the previous month’s 2.7 percent increase, the National Bureau of Statistics (NBS) said on Thursday. The consumer price index (CPI) rose 1.9 percent last month compared with a year earlier, also below market expectations for a 2.1 percent gain.