Oct 09 2018

Rupee plunged to its fresh record low tracking rebound in Oil prices and fiscal gap fears

Financial Market Overview

09th October, 2018

Evening Coffee:-                                                                                  

MARKETS AT CLOSE:-

Rupee:-

  • Indian rupee continued its downtrend and plunged to a record low for a fifth day against the dollar, tracking a rebound in oil prices and as comments from a government official sparked concerns over fiscal deficit.
  • The rupee settled at a record-low 74.39 to a dollar, against 74.06 at close yesterday. It plunged to 74.41 intraday, surpassing the earlier record low of 74.23 hit last week. However, further losses were limited on persistent suspected interventions by the central bank.
  • India is discussing options such as spending cuts and subsidy rollover to achieve the fiscal deficit target, amid fears of revenue loss due to possibilities of state-run fuel retailers not paying dividends and shortfall in indirect tax collection, a government official said.

Indian Equities:-

  • Indian shares ended lower on Tuesday at their lowest closing level since April, with market heavyweight Tata Motors Ltd dragging down the indexes amid weak global cues.
  • The benchmark BSE index closed down 0.51 percent at 34,299.47. The broader NSE index ended 0.45 percent lower at 10,301.05.Tata Motors saw its worst day in nearly six years, closing 13.2 percent lower, following weak sales of Jaguar Land Rover.

Global Markets:-

  • European markets are lower today. The SMI is down 0.56%, the Germany’s DAX is off 0.51%, the Eurozone’s STOXX50 fell 0.44%, the London’s FTSE100 off 0.43%, the France CAC40 is down 0.32% and the Spain’s IBEX35 is trading lower by 0.20%.
  • The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was up 0.29% to 95.72, within close reach of the six-week high of 95.78 reached late last week.
  • The euro extended early losses on Tuesday, falling to fresh seven-week lows as concerns over Italy’s fiscal outlook and a broadly stronger dollar weighed. EUR/USD was last seen at 1.1432 down 0.61%.
  • The Euro was pressured lower amid an ongoing row between Italy’s populist government and the European Commission over the country’s budget plans. Brussels and Rome have been at odds over the country’s budget deficit plans for the next three years, which breach EC rules on running excessive deficits and high debt.
  • The benchmark Brent crude oil contract was trading up 0.9% at $84.65 per barrel, snapping a three-session loss, amid reports of decline in crude exports from Iran, one of the major oil exporters, ahead of U.S. sanctions that will kick in on Nov. 4.