Jan 08 2019

Rupee Opened Lower As Crude Oil’s Climb

Financial Market Overview

08th January, 2019

Morning Coffee:-                                                                        

MARKETS AT OPEN:-

Rupee:-

  • The Indian rupee opened lower against the dollar after Brent crude oil reached its highest level since mid-December, offsetting a further decline on the dollar index.
  • The rupee opened 69.75 versus its previous close of 69.68. Immediate-term technical factors are a bit weak on the rupee going into trade today in light of the domestic currency’s inability to close above 68.30 yesterday. There is “huge” buying pressure from importers for the dollar below 69.50 and the rupee is “struggling to clear this hurdle. Brent was little changed in early Asia trade on Tuesday after rising for the sixth straight day yesterday to close at its highest level in three weeks.
  • The contract is now up more than 14% after having reached two-year lows of $50 a barrel around Christmas. The recovery in U.S. equities since the last week of 2018 and recent weakness in the dollar have contributed to the turnaround in oil prices..
  • We expect USD/INR to trade in a range between 69.70- 70.25 today.

Indian Equities:-

  • Equity benchmarks have witnessed a strong start with the Sensex rising over 66.52 points, while the Nifty has down 10,775.25.
  • The Sensex opened up by 0.19% at 35916.68 while the Nifty opened higher by 0.03% at 10775.25.

Global Markets:-

  • Asian markets are higher today as Japanese and Hong Kong shares show gains. The Nikkei 225 is up 0.80% while the Hang Seng is up 0.13%. The Shanghai Composite is trading down by 0.20%.Where Australian ASX 200 is up by 31 points positive and 0.56%.
  • com Inc and Netflix Inc fueled a second straight session of gains on Wall Street on Monday, with the resumption of U.S.-China trade talks helping ease concerns that have pummeled the market in recent months. The Dow Jones Industrial Average rose 98.32 points, or 0.42 percent, to 23,531.48, the S&P 500 gained 17.76 points, or 0.70 percent, to 2,549.7, and the Nasdaq Composite added 84.61 points, or 1.26 percent, to 6,823.47.
  • European markets finished lower today with shares in London leading the region. The FTSE 100 is down 0.39% while France’s CAC 40 is off 0.38% and Germany’s DAX is lower by 0.18%.
  • Meanwhile, the dollar index slipped for the third day yesterday amid bets that the Federal Reserve is unlikely to raise interest rates this quarter. The index’s 0.5% decline yesterday took it to its lowest level, on a closing basis, since mid-October.
  • U.S. services sector activity slowed to a five-month low in December, but remained above a level consistent with solid economic growth in the fourth quarter. The Institute for Supply Management said on Monday its non-manufacturing activity index fell to 57.6 last month, the lowest reading since July, from 60.7 in November. Still the index stayed well above the 50 mark, suggesting expansion of the vast services sector.
  • The rate of growth in the economy’s service sector slowed at a sharper rate than expected in December, according to a report released on Monday. The Institute of Supply Management said its non-manufacturing purchasing managers’ index fell to 57.6 from November’s 60.7, compared to forecast for a more modest decline to 59.6. It was the lowest reading since July 2017. A reading above 50 for the index indicates expansion in the sector, and a reading below signals contraction. Among the sub-indices, the non-manufacturing business activity index decreased to 59.9 last month, from 65.2 in November.