Nov 05 2018

Rupee Opened Lower After Upbeat US Jobs Report

Financial Market Overview

05th November, 2018

Morning Coffee:-                                                                        

MARKETS AT OPEN:-

Rupee:-

  • The Indian rupee opened lower against the U.S. currency after employers in the world’s largest economy added more jobs last month than expected, prompting a rise in the dollar index and Treasury yields. The rupee opened at 72.80 versus its previous close of 72.44, the upbeat jobs data suggests that the Federal Reserve will raise interest rates once more next month and continue on its path of policy normalization by closing above the immediate support of 73 last week, the rise in 10-year Treasury yields back above 3.20% and regional risk off will make it difficult for the domestic unit to sustain its recent rally.
  • In addition to the Fed outcome, the focus will be on the U.S. midterm elections this week. Voting will take place on Nov. 6 and by the early hours of the next day, it will become evident whether the U.S. Republicans manage to retain their majority in both the houses.
  • Dollar index little changed at 94.48 after advancing 0.3% on Friday.
  • We Expect Pair to trade in the range between 72.60 to 73.00

 Indian Equities:-

  • Equity benchmarks have started lower today morning trade, with the Nifty opened at 10514 level – 39 points.
  • The Sensex is down by 100.00 points at 34911.00,

 Global Markets:-

  • Asian markets are lower today as Japanese, Chinese and Hong Kong shares fall. The Nikkei 225 is off 1.16% while the Hang Seng is down 2.31%. The Shanghai Composite is not trading. The Shanghai Composite is off 0.59% while the Australian ASX200 is down by 15 points and 0.26% down.
  • European markets finished mixed as of the most recent closing prices. The DAX gained 0.44% and the CAC 40 rose 0.32%. The FTSE 100 lost 0.29%.
  • U.S. stocks snapped a three-day rally on Friday as Apple shares dropped following a disappointing forecast and the White House dampened optimism over U.S.-China trade talks.
  • The Dow Jones Industrial Average fell 111.34 points, or 0.44 percent, to 25,269.4, the S&P 500 lost 17.6 points, or 0.64 percent, to 2,722.77 and the Nasdaq Composite dropped 77.06 points, or 1.04 percent, to 7,356.99.
  • U.S. job growth rebounded sharply in October and wages recorded their largest annual gain in 9-1/2 years, pointing to further labor market tightening that could encourage the Federal Reserve to raise interest rates again in December. The Labor Department’s closely watched monthly employment report on Friday also showed the unemployment rate steady at a 49-year low of 3.7 percent even as more people entered the labor force, in a sign of confidence in the jobs market.
  • Communist-run Cuba’s economic growth will come in at around 1 percent this year, compared with the 2 percent previously forecast, due to a fall in exports and tourism revenue, state-run media reported over the weekend.
  • The Caribbean island’s gross domestic product grew 1.8 percent last year and 0.5 percent in 2016.
  • Economy and Planning Minister Alejandro Gil Fernandez reportedly told a council of ministers meeting that the lowered GDP growth forecast for this year was due to “less than expected revenues from activities such as tourism, the harvest (sugar) and mining (nickel),” three key revenue sources for Cuba.